Preamble

The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.

PRIVATE BUSINESS.

Private Bills [Lords] (Standing Orders not previously inquired into complied with),

Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That in the case of the following Bills, originating in the Lords, and referred on the First Reading thereof, the Standing Orders not previously inquired into, which are applicable thereto, have been complied with, namely:

Bootle Corporation Bill [Lords].

Hastings Tramways Company (Trolley Vehicles) Bill [Lords].

Southport Corporation Bill [Lords].

Brixham Gas and Electricity Bill [Lords].

Bills to be read a Second time.

Provisional Order Bills (Standing Orders applicable thereto complied with),

Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That in the case of the following Bills, referred on the First Reading thereof, the Standing Orders, which are applicable thereto, have been complied with, namely:

St. Helens Corporation (Trolley Vehicles) Provisional Order Bill.

Wolverhampton Corporation (Trolley Vehicles) Provisional Order Bill.

Ministry of Health Provisional Order (South Molton Rural) Bill.

Bills to be read a Second time To-morrow.

Provisional Order Bills (No Standing Orders applicable),

Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That in the
case of the following Bills, referred on the First Reading thereof, no Standing Orders are applicable, namely:

Ministry of Health Provisional Orders (Great Torrington, Minehead and Taf Fechan Water Supply Board) Bill.

Ministry of Health Provisional Order (Uxbridge Joint Hospital District) Bill.

Bills to be read a Second time To-morrow.

Bristol Cattle Market Bill,

Glasgow Corporation Bill,

Read the Third time, and passed.

Oral Answers to Questions — SCOTLAND.

ROAD STATISTICS (ROSS AND CROMARTY).

Mr. RAMSAY: 2.
asked the Secretary of State for Scotland the approximate population, the mileage of roads, and the amount of money expended on the said roads, on the mainland part of the county of Ross and Cromarty for the last year during which the late county council functioned; and the corresponding figures for the island of Lewis during the same period?

The SECRETARY of STATE for SCOTLAND (Mr. William Adamson): As the reply involves a table of figures I propose to circulate it in the OFFICIAL REPORT.

Mr. MACPHERSON: Is the right hon. Gentleman aware that there are a great many roads still requiring improvement, and will he take steps to see that some improvement is made?

Following are the figures:


—
Ross and Cromarty Mainland.
Lewis.


Approximate population
40,500
26,850


Mileage of roads
839.6
304.2


Road expenditure
£95,189
£24,850

The figures applicable to burghs are included.

The road expenditure in the year ended the 15th May, 1930, is not yet available and the figures quoted are for the year 1928–29. These figures are exclusive of a sum of £22,781 applicable to the construction of the Inverness, Invergordon, Bonar Bridge, Wick and Thurso Road, the total cost of which has been met by the Minister of Transport.

HOUSING (WOODWORK).

Major COLVILLE: 3.
asked the Secretary of State for Scotland if he is aware that a large quantity of foreign manufactured woodwork is being used in State-aided housing schemes in Scotland; and, if so, what steps he is prepared to take to promote a greater use of articles of British manufacture?

The UNDER-SECRETARY of STATE for SCOTLAND (Mr. Johnston): I am aware of the recent increase in the figures for imported builders' woodwork. Notwithstanding Sub-section 1 of Section 10 of the Housing (Financial Provisions) Act, 1924, which, so far as housing schemes under that Act are concerned, prohibits the imposition of any condition which would prevent materials from being purchased in the cheapest market either at home or abroad, a circular was issued by my Department on the 23rd December last urging local authorities in Scotland to make use to the utmost practicable extent of goods and materials of home production in the case of contracts entered into by them not only for houses but also for all other works. I am sending the hon. and gallant Member a copy of the circular.

Major COLVILLE: In view of the large number of joiners who are unemployed in Scotland at the present time, does not the hon. Gentleman think that it is time the Act was amended to make the use of British materials obligatory in these schemes?

Mr. JOHNSTON: The best answer that I can give to the question is to call attention to the terms of the circular of recommendations which I sent to the local authorities.

Mr. BUCHANAN: Has not the hon. Gentleman the power, in the case of imported goods made under unfair conditions, to deal with them in the same way as that which is provided by the Fair Wages Clause in respect of home work?

Mr. JOHNSTON: Yes, Sir. In certain cases goods made under these conditions can be prohibited altogether.

Lieut.-Colonel Sir FREDERICK HALL: What are fair conditions of labour? Are they the conditions operating in this country?

IMPRISONMENT FOR DEBT.

Mr. STEPHEN: 5.
asked the Secretary of State for Scotland if he is now in a position to state the names of the committee set up to inquire into the question of imprisonment for debt in Scotland?

Mr. MACLEAN: 1.
asked the Secretary of State for Scotland whether he can now state the personnel of the committee he has promised to set up to inquire into the operation of hire purchase agreements in Scotland and the imprisonment of debtors for failure to maintain their payments, and the terms of reference to that committee?

Mr. W. ADAMSON: I am in communication with certain parties whom I propose to appoint, but have not yet received their consent to serve, and I am not therefore in a position to announce the personnel of the committee. The terms of reference will be "To inquire into and report on the existing law relating to contracts of hire purchase, with reference particularly to the conditions commonly inserted in such contracts and the sanction of imprisonment by which such contracts may in certain circumstances be enforced, and to report thereon and on the question what amendments, if any, on the law or administration relating to such contracts are desirable."

Mr. STEPHEN: Can the right hon. Gentleman say whether he will be in a position to give an answer if I put down another question in a week's time?

Mr. CHARLES WILLIAMS: Do Scotsmen ever get into debt?

Mr. KIRKWOOD: I hope that the Secretary of State for Scotland is going to see to it that persons other than lawyers are appointed to this committee. [HON. MEMBERS: "Why?"] Because there are more of common humanity than just lawyers. That is the point.

RENT RESTRICTIONS ACTS.

Mr. HARDIE: 7.
asked the Lord Advocate whether he is aware that house
factors in Glasgow are pasting notices inside rent books stating that the let is excluded from the operation of the Rent and Mortgage Restriction Acts, 1920 to 1925; and whether he will take steps to have such practice stopped?

The LORD ADVOCATE (Mr. Craigie Aitchison): My attention has been drawn to one or two instances of the practice referred to, and the matter is receiving consideration.

Mr. HARDIE: Can the Lord Advocate, in view of the facts which are coming before him, say whether any steps are going to be taken by the Government to impose a penalty in cases where the Act is not carried out?

The LORD ADVOCATE: That is one of the matters which are receiving consideration. I have no power, as Lord Advocate, to intervene; but, if it be the fact that in cases where no actual decontrol has taken place, notices have been pasted in the rent books to the effect that there has been decontrol, and if the tenants are being thereby induced to pay more than they ought to pay, the view of the Government is that it is the situation which calls for intervention, and the Government will take the necessary steps to deal with the matter.

Mr. HARDIE: Is it the opinion of the Government or of the Lord Advocate that the pasting of notices inside the rent books is an illegal act?

The LORD ADVOCATE: Undoubtedly. In every case where there is no decontrol, it is illegal in the sense that it is wrongfully inducing a tenant to pay more than he ought to pay, and it is an illegality for which the tenant has a remedy under the Statute as it at present stands. But the Government think that the tenants ought to have a further remedy by inserting some form of protection, and that is a matter which is receiving consideration.

Mr. HARDIE: Is it just a question of a tenant being compelled as his only remedy is to employ a lawyer, or are the Government going to see that he is not put to that expense?

The LORD ADVOCATE: At the present time the tenant must take such remedies as he has in the Law Courts, but the Government are considering
whether some other form of remedy can be devised to prevent the necessity of the tenant going to a lawyer at all.

Mr. STEPHEN: Is it not the case at the present time that the law provides for the prosecution of property owners who are taking more than the rent allowed under the Rent Restrictions Act? If that is so, is it not possible for prosecutions to take place under the direction of the Lord Advocate?

The LORD ADVOCATE: No, it is not a question of taking more rent than is due. The Statute supplies a remedy for that. It is a question of pasting notices in a rent book which are calculated to mislead the tenant into a false impression as to the rent he has to pay. That is the matter with which we are dealing.

Mr. STEPHEN: Is not the Lord Advocate aware that in many of the cases where the notices have been pasted in the book, the property owner is taking more than the rent which is allowed, and why is the Lord Advocate not initiating prosecutions so as to give protection against such people.

The LORD ADVOCATE: If the hon. Member will bring specific instances to my notice instead of making general statements, I will have them properly investigated and appropriate steps taken.

Oral Answers to Questions — TRADE AND COMMERCE.

ELECTRICAL GOODS AND APPARATUS.

Major COLVILLE: 8.
asked the Lord Privy Seal if he is aware of the large increase in the quantity of foreign electrical goods and apparatus imported into this country during the last year; and if he will consider what steps can be taken to encourage a greater use of British appliances in the market that has been created by the Central Electricity Board?

The LORD PRIVY SEAL (Mr. J. H. Thomas): Yes, Sir. I am a ware of the increase to which the hon. and gallant Member refers. It is in the main due to increased imports of the smaller type of appliance bought by the private user of electricity and wireless. The desirability of giving preference to British goods subject to reasonable price relationship has already been brought to general notice, and I trust that the
British manufacturers and distributors will be alive to the importance of this new and expanding market.

Major COLVILLE: Does not the Lord Privy Seal consider that it is a serious matter that this market which has been created largely by the work of the Central Electricity Board, should be captured by foreign manufacturers, and can he consider taking any other steps which might help?

Mr. THOMAS: The difference last year as compared with the previous year was approximately 2 per cent. It is true that the work of the Central Electricity Board has created a demand, and it is equally true that the Central Electricity Board have given all their contracts to British firms, as I have already said. In addition to that, I have drawn attention of the manufacturers to the importance of their taking advantage of the appetite which I created.

Mr. KIRKWOOD: Is it not the case that British electrical appliances are the finest in the world?

Mr. O'CONNOR: Is the Lord Privy Seal aware that there will be a similar influx of imported lace when the duty is taken off that article?

COTTON INDUSTRY.

Mr. HERBERT GIBSON: 10.
asked the Lord Privy Seal whether his attention has been called to the delay in proceeding with schemes of amalgamation in the Lancashire cotton trade; whether the causes for this state of affairs are to be found within the industry or in the policy pursued by the banks; and whether he will take steps to stimulate the efforts being made to place the cotton trade upon a sounder economic basis?

Mr. DOUGLAS HACKING: 9.
asked the Lord Privy Seal whether he is aware that, owing to financial obstacles, the reorganisation of the Lancashire cotton trade on the basis of large scale amalgamations is being retarded; and whether, in view of his promises of financial assistance to such schemes, he is able to announce any measures for overcoming the difficulties at present encountered?

Mr. THOMAS: I have no reason to think that any sound scheme for the reorganisation of the Lancashire cotton industry
is being retarded by lack of finance. The question of the provision of finance for schemes of rationalisation is dealt with in the statement which I made on the 15th April, in reply to the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy), regarding the Bankers' Industrial Development Company, Limited. I am sending the hon. Member a copy of that statement. As the House will be aware, the Government appointed last summer a Committee to investigate the cotton industry, and their report is expected very shortly. I hope before the end of this week.

Mr. GIBSON: When the report on the cotton trade is presented, will the Lord Privy Seal go to Lancashire with a view to calling together the employers and the employés to see what steps can be taken to implement the report and bring about a better state of things?

Mr. ARTHUR MICHAEL SAMUEL: And when he goes down, as I hope he will, will he interview the leaders of the Manchester Chamber of Commerce and take into account the vote they declared yesterday?

Mr. THOMAS: The last time I was in Manchester I thought it wise to interview those engaged in the industry. That I shall continue to do. With regard to the first supplementary question, I think the right way would be to take into conference freely and frankly both sides engaged in the cotton industry. Whether that will be my task time alone will determine.

ARGENTINE (COMMERCIAL AGREEMENT).

Mr. HANNON: 21.
asked the President of the Board of Trade whether any further steps have been taken towards the consummation of the projected commercial agreement between this country and the Argentine?

The PRESIDENT of the BOARD of TRADE (Mr. William Graham): The agreement is awaiting the approval of the Argentine Senate.

Mr. HANNON: Has the right hon. Gentleman been in communication with the Dominions, Colonies and Protectorates to ascertain how the scheme may affect them, in view of the possible extension of inter-Imperial trade in the future?

Mr. GRAHAM: In reply to previous questions in the House, I have indicated that in connection with this agreement all factors were taken into account.

Mr. HANNON: Has there been any difficulty with the Argentine Senate in sanctioning the agreement?

Mr. GRAHAM: I would prefer not to offer an opinion. It is still awaiting the approval of the Senate, and I hope that it will be approved.

PORTUGAL (CONTRACTS).

Mr. HANNON: 22.
asked the President of the Board of Trade whether his attention has been called to the programme of reconstruction recently approved by the Portuguese Government for the development of land and water communications; and if he will make appropriate representations to the Portuguese authorities that, in view of the material support which this country has rendered from time to time to Portgual, British manufacturing firms should have sympathetic consideration for contracts which may follow when the reconstruction scheme comes into operation?

Mr. W. GRAHAM: Reports have been received in regard to this programme and British firms are being kept informed. While His Majesty's Government are always prepared to take what action they usefully and properly can in support of the interests of British firms, I do not think that general representations such as the hon. Member suggests would serve any useful purpose.

Mr. HANNON: If it comes to the knowledge of the right hon. Gentleman that definite schemes are in process at the instance of the Portuguese Government, will he make representations so that British manufacturers are given a full opportunity for tendering?

Mr. GRAHAM: I have indicated in my reply that we are trying to do our best in connection with the terms. Certainly I shall spare no effort to that end.

Major COLFOX: Will the right hon. Gentleman bring the matter to the notice of the Liberal party?

Mr. ERNEST BROWN: Chinese!

UNITED STATES (TARIFFS).

Mr. HANNON: 23.
asked the President of the Board of Trade whether he will
state the nature of the representations which have been made through the British Ambassador at Washington to the Government of the United States during the process of the tariff debate at Washington, with the object of safeguarding, so far as possible, the interest of British exporters of manufactured goods to that country in view of the proposed increase of import duties?

Mr. W. GRAHAM: No formal representations have been made by His Majesty's Government to the Government of the United States, but as I have previously explained to the House certain memoranda respecting the trade in specific commodities which had been submitted by trade associations or firms in this country were communicated by Majesty's Embassy at Washington to the United States authorities.

Mr. HANNON: Will the right hon. Gentleman indicate to the House what is the procedure on the part of the Board of Trade when a foreign country takes steps to raise its tariff against goods from this country? Is there not some means of making representations?

Mr. GRAHAM: I have indicated that in this case the representation on which information is gained has been communicated to His Majesty's Ambassador at Washington, and put before the appropriate committees or sections of the legislative committees of the United States Government.

CENSUS OF PRODUCTION.

Major NATHAN: 24.
asked the President of the Board of Trade if he will state the present position as regards the census of production?

Mr. W. GRAHAM: I anticipate that the first of the volumes of the Final Report on the Third Census, covering the textile trades, will be issued in from two to three weeks from the present time. The volumes dealing with other groups of trades are being prepared with the greatest possible speed, and I hope that no unforeseen circumstances will delay their preparation and issue.

Major NATHAN: In view of the remarkably adverse change in circumstances since the census was set on foot, will the right hon. Gentleman take into consideration the immediate setting up
of a further census of production at the same time as the population census of 1931?

Mr. GRAHAM: Preparations are now in hand for the census covering 1930, and I have already sanctioned much more than the preliminary efforts in that matter.

Mr. C. WILLIAMS: Do we understand that this production of the Government is out of date before it is issued?

Mr. GRAHAM: No, that would be a very erroneous assumption. On the other hand, very careful analysis is necessary in order that the volume may not be open to the charge of inaccuracy in a matter which is most important to our trade.

EXPORT CREDITS (RUSSIA).

Mr. A. M. SAMUEL: 65.
asked the Secretary to the Overseas Trade Department if he will ascertain and state what are the terms of credit accorded by the Soviet Government to British purchasers of Russian raw materials?

Mr. GILLETT (Secretary, Overseas Trade Department): I have no detailed information, but I understand that the Soviet Government usually stipulate for cash with order when selling their raw materials to foreign purchasers.

Mr. SAMUEL: Are we to understand that when the commercial Treaty was under discussion no arrangements were made that the Soviet delegation should give the same terms to our merchants as they asked from our merchants?

Mr. GILLETT: I have never heard of any such arrangement being made.

Mr. SAMUEL: Is not that a case of laches on the part of the hon. Member?

Mr. GILLETT: No, Sir, it does not strike me in that way at all.

Sir CHARLES CAYZER: 66.
asked the Secretary to the Overseas Trade Department whether it is proposed to extend the Exports Credits Guarantee Scheme so as to guarantee the credit of the Soviet Government for a longer period than one year?

Mr. GILLETT: It is not the practice to state in advance the conditions on which the Advisory Committee are prepared to recommend the granting of
guarantees in respect of any country or any particular transaction.

Sir H. CAYZER: Does the Minister say that the statements in the Press that the Government are contemplating extending the Export Credits Scheme in the case of Russia from one year to three years are not correct?

Mr. GILLETT: It is impossible for me to be responsible for everything that appears in the Press.

Sir WILLIAM DAVISON: Before any extended credits are given, will the hon. Gentleman see that our merchants receive similar treatment for goods sent to Russia?

Mr. LOUIS SMITH: Does not the hon. Gentleman realise that unless the terms are extended our traders will be unable to compete with traders in other countries where the terms are extended?

Brigadier-General CLIFTON-BROWN: 68.
asked the Secretary to the Overseas Trade Department what is the total amount of money that has been advanced and promised under the Export Credits Act since 1st January, 1930, for credits to finance Russian enterprises and how much to finance Dominion enterprises, respectively?

Mr. GILLETT: The object of the Export Credits Guarantee Scheme is not to finance enterprise overseas but to assist British exporters by enabling them to give credit. No advances are made, but on certain conditions the payment of a proportion of bills of exchange drawn in connection with the export of British goods is guaranteed. Contracts have been entered into from the 1st January, 1930, to the 31st May last, providing for the payment of a proportion of bills of exchange for £1,834,812 drawn on Russian, purchasers and £167,447 drawn on purchasers in the Dominions.

Brigadier-General BROWN: Is the hon. Gentleman aware that there is an impression that it is very much easier to get credits to do business with Russia than with our Dominions; and may I ask what is the policy of the Government on that point?

Mr. GILLETT: I think the hon. Member has forgotten that this is an insurance scheme, and therefore the figures are what
one would expect. One does not need to insure a payment which is to be received from the Bank of England.

Sir NICHOLAS GRATTAN-DOYLE: May I ask whether the candles may now be brought in?

BOOT AND SHOE TRADE (RUSSIAN ORDER).

Mr. REMER: 67.
asked the Secretary to the Overseas Trade Department what is the length of extended credit required by the Soviet delegation to enable them to purchase 3,000,000 pairs of boots and shoes of Northampton manufacturers?

Mr. GILLETT: No definite application has been received by the Export Credits Guarantee Department in respect of this order; but in any case, it is not the practice to disclose particulars concerning any individual transaction.

Mr. SAMUEL: If this order is still available, will not the hon. Gentleman suggest to the Soviet Delegation that they should try to raise a loan for capital purposes in the City of London?

Oral Answers to Questions — UNEMPLOYMENT.

DEPRESSED INDUSTRIES (FINANCIAL FACILITIES).

Lieut.-Commander KENWORTHY: 12.
asked the Lord Privy Seal whether he can give the House any account of the success of his efforts in preventing factories, mines, etc., from closing down during the present trade depression; and if he has any estimate of the number of men and women he has prevented from being thrown out of employment as a result of such intervention?

Mr. THOMAS: I am afraid that it would not be possible to give the information for which my hon. Friend is asking without disclosing particulars which it would not be in the public interest and certainly against the interests of employment to divulge. I may say that I am almost daily engaged in endeavouring to make financial provisions to prevent the closing of works, but obviously I cannot mention firms across the Floor of the House.

Lieut.-Commander KENWORTHY: Cannot the Lord Privy Seal give an estimate in answer to the second part of the
question, and also in reply to the accusations made by hon. Members opposite about putting people out of work?

Mr. THOMAS: As far as those accusations are concerned, I am fairly thick skinned.

Viscountess ASTOR: Can the Lord Privy Seal tell us of any work that this Government has given to the quarter of million of women who have been added to the unemployment figures since they came into power?

Mr. THOMAS: The Noble Lady must know very well that there are training centres for women, and she also knows very well that neither this nor any other Government, even if she herself was at the head of the Government, could set out merely to provide for a sex as distinct from the general body of unemployed.

GLASGOW COURT OF REFEREES (CHAIRMAN).

Mr. STEPHEN: 60.
asked the Minister of Labour when Mr. Semple was appointed Chairman of the Court of Referees in Glasgow; if the local working-class organisations were asked to make recommendations for such appointment; and, if not, what bodies were consulted?

The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. Lawson): Mr. Semple was appointed as a Chairman of the Glasgow Court of Referees in June, 1928, and was reappointed on the 26th March this year. As regards the last part of the question, I would refer my hon. Friend to the reply given on 29th May to the hon. Member for Gorbals (Mr. Buchanan).

Mr. BUCHANAN: Will the hon. Gentleman reply to the last part of the question: whether any working-class organisations were consulted when this appointment was made?

Mr. LAWSON: In this case, which was a re-appointment, there was no consultation at all, and my right hon. Friend knew of no objection to this re-appointment.

Mr. BUCHANAN: Is the hon. Gentleman aware that in this House various Members representing the trade union and labour movement in Glasgow voiced
strong objection, and was not that a reason why the trade union movement should have been consulted?

Mr. LAWSON: My right hon. Friend had no specific complaint against this appointment, and, if there is any specific complaint, she will have investigation made into it.

BENEFIT DISALLOWED.

Mr. STEPHEN: 61.
asked the Minister of Labour if she is aware that the average number of claims disallowed monthly on the ground of not normally insurable previous to 10th September, 1929, averaged about 1,200, and that since they were included from that date with the disqualification "not a reasonable period of insurable employment," the average figure is about 10,000; and, since the new Act has abolished the latter disqualification, can she explain why the disqualifications on the former ground have not returned to somewhere about the average figure for the period preceding 10th September, 1929?

Mr. LAWSON: The disallowances under the new Act were imposed by Courts of Referees, and those for the earlier period by insurance officers; in neither case, therefore, were they within the Minister's control. I may point out, however, that when the new Act came into force, there was a large number of new claims and this was likely to lead temporarily to a larger number of disallowances. I should add that as was pointed out by my right hon. Friend in her reply to my hon. Friend on 22nd May, the numbers of disallowances under these heads, taken by themselves, are not properly comparable with those for earlier periods.

Mr. STEPHEN: Would it not appear that those who were formerly disqualified under the "not having a reasonable amount of employment in the preceding two years" condition, are now being dealt with under the "not normally insurable" condition, and that the intention of this House is being evaded; and will the Minister of Labour look into the operation of this condition?

Mr. LAWSON: The local courts of referees with local knowledge have power to give definite decisions, and, as long as they give their decisions in accordance
with the law, my right hon. Friend can do nothing in the matter. Many of these cases are, as my right hon. Friend has said, not comparable, because in many cases people claimed who are not insurable.

Mr. EDE: Is not my hon. Friend aware that the gravest dissatisfaction exists in regard to this matter and will he have the matter looked into by his Department?

Mr. LAWSON: My right hon. Friend is giving the closest possible attention to the matter, and has taken into consideration the representations made on this matter.

CONSUMERS' COUNCIL BILL.

Sir KINGSLEY WOOD: 13.
asked the President of the Board of Trade whether representatives of the co-operative societies were consulted in relation to the provisions of the Consumers' Council Bill; and whether any representations have been received from any such organisations in reference to these proposals?

Mr. W. GRAHAM: A representation was received from the Parliamentary Committee of the Co-operative Congress to the effect that the co-operative movement should be represented on the Consumers' Council.

Sir K. WOOD: Is the right hon. Gentleman surprised that he has not received some protest from the co-operative societies about this Bill? Is not the Bill a grave reflection on the co-operative movement?

Mr. GRAHAM: This is a Bill to protect the consumers; and we have a considerable measure of support for it.

Sir K. WOOD: Have not the co-operative societies always been protecting the consumers?

Viscountess ASTOR: Is it not the case that the co-operative societies have financed the Labour Members?

Mr. KIRKWOOD: Who financed you? The working classes? [Interruption.]

Sir F. HALL: On a point of Order. Is that a fair question?

Oral Answers to Questions — GOVERNMENT DEPARTMENTS.

ENEMY DEBTS DEPARTMENT.

Lieut.-Colonel Sir A. LAMBERT WARD: 14.
asked the President of the Board of Trade the number of staff at home and abroad employed by the Clearing Office for Enemy Debts; and to what number it is proposed to reduce the staff as at 1st July?

Mr. W. GRAHAM: The staff of the Clearing Office (Enemy Debts) at present numbers 366. Three officers are under notice terminating their present appointments at the end of June.

Sir A. LAMBERT WARD: Can the President of the Board of Trade give any indication as to how long he considers it will be necessary to keep this Department in existence?

Mr. GRAHAM: No, there is always this difficulty. Many of the outstanding cases are very involved in character, but I have always thought, without committing myself to a date, that it should be finished in the near future. I cannot, however, name any date.

Colonel GRETTON: Has the right hon. Gentleman been to the office to see for himself what is going on?

Mr. GRAHAM: No, but I became very familiar with the circumstances to which reference is made during the five years that I was Chairman of the Public Accounts Committee.

P CLASS.

Sir F. HALL: 53.
asked the Financial Secretary to the Treasury whether he can now state what reductions, if any, are made in the pay of P-class men in the Civil Service when they are promoted to the established class?

The FINANCIAL SECRETARY to the TREASURY (Mr. Pethick-Lawrence): An agreement has recently been reached with the staff associations concerned under which the temporary reduction in pay hitherto arising in some cases on the promotion of P-class clerks to established clerical classes will be prevented.

WAR OFFICE AND ADMIRALTY.

Captain BALFOUR: 55.
asked the Financial Secretary to the Treasury the cost and numbers of the personnel of the Army and Navy staffs at the War
Office and Admiralty; and the Civil Service personnel employed on duties within those services for 1929–30 and 1913–14?

Mr. PETHICK-LAWRENCE: As the answer contains a number of figures, I will, with the hon. and gallant Member's permission, circulate it in the OFFICIAL REPORT.

Following is the answer:

The records kept by the Admiralty and the War Office are not altogether in the same form, but I think that the following figures, which have been supplied to me, will serve the hon. and gallant Member's purpose:


Admiralty.


—
Naval Officers and Ratings.
Civilians.


(a) Numbers serving at Headquarters on 1st Jan., 1914.
152
1,910


Cost
£98,669
£364,933


(b) Average numbers borne during 1929–30.
252
2,780


Cost
£270,000
£986,000




War Office.


—
Officers and other Ranks.
Civilians.


(a) Numbers provided in Estimates, 1913–14.
262
1,579


Cost
£143,200
£296,800


(b) Numbers provided in Estimates, 1929–30.
351
1,947


Cost
£300,290
£613,000

PERSONNEL.

Captain BALFOUR: 56.
asked the Financial Secretary to the Treasury the numbers and cost of the permanent and temporary personnel of the Civil Service in 1929–30; and the numbers and cost in 1913–14?

Mr. PETHICK-LAWRENCE: I would refer the hon. and gallant Member to the reply which I gave to my hon. Friend the Member for Westhoughton (Mr. Rhys Davies) on the 17th April last, giving the
numbers and cost of Civil Service personnel in 1913–1914 and 1928–1929, respectively. Coresponding figures for the year 1929–30 are not yet available.

Brigadier-General BROWN: When will these figures be available?

Mr. PETHICK-LAWRENCE: I cannot say at the moment, but I will look into it, and perhaps the hon. and gallant Member will put a question down.

COAST EROSION (NEWHAVEN AND WORTHING).

Mr. DAY: 15.
asked the President of the Board of Trade whether his attention has been called to the increasing subsidence of land and consequent damage to property on the coast road between Newhaven and Worthing; and whether he proposes to take any action in the matter?

Mr. W. GRAHAM: I am aware that a certain amount of erosion has occurred on this section of the coast, and my Department has from time to time sanctioned the construction of protective works. The Board have, however, no power to initiate schemes for sea defence or to compel the local authorities responsible for the various areas to do so.

Mr. DAY: May I ask whether the right hon. Gentleman's inspectors make a regular visit to this part of the coast?

Mr. GRAHAM: I Cannot say offhand as to inspection, but I know that they are familiar with the whole question of coast erosion, which was the subject of a Bill introduced into the House, though I am afraid the Government cannot find time for the remaining stages.

Mr. DAY: Will the right hon. Gentleman ask these inspectors to pay particular attention to this part of the coast?

Mr. GRAHAM: I will look into the point to which the hon. Member refers.

Captain PETER MACDONALD: Is it the intention to proceed with the Bill this Session?

Mr. GRAHAM: No. The Prime Minister has already indicated that it may not be possible to make further progress
with the Bill. I am afraid that is beyond doubt.

Major COLFOX: Would it not be better to drop some of the other items in the programme of the Government?

Oral Answers to Questions — MERCANTILE MARINE.

HEALTH STATISTICS (CREW SPACES).

Lieut.-Colonel FREMANTLE: 17.
asked the President of the Board of Trade if the health advisory committee on the mercantile marine have yet reported the results of their investigations into the statistics relating to the mortality of seamen and the hygiene of crew spaces on board ship; and whether the report will be published?

Mr. W. GRAHAM: I would refer the hon. and gallant Member to the replies given on the 1st April to my hon. Friend the Member for Southampton (Mr. Morley) and on the 6th May to the hon. Member for Barnstaple (Sir B. Peto), to which at present I am unable to add.

Lieut.-Colonel FREMANTLE: Does the right hon. Gentleman realise that this body of men alone have been left out of the arrangements for looking after the health of the people, and that they are a most important body. Why has this selection been made? Why is no effort being made to overtake this melancholy lapse in our organisation?

Mr. GRAHAM: I have never underestimated their importance, but at the moment the inquiry is taking the form of a review of certain-months of statistics, up to the end of September of this year, and until that is completed it is quite impossible to do more.

Lieut.-Colonel FREMANTLE: The question of the hygiene of crew spaces has nothing to do with statistics and will have to be dealt with by an entirely different body.

WAR INJURIES.

Mr. BELLAMY: 20.
asked the President of the Board of Trade if he will state the number of men who were engaged in the mercantile marine during the period of the Great War and who suffered the loss of a limb or limbs in consequence of such service and, of these,
the number in respect of whom his Department have accepted financial responsibility?

Mr. W. GRAHAM: I regret that the desired information cannot be made available without a laborious investigation, but the number of cases in which my Department has assumed responsibility for the supply and miantenance of seamen's artificial limbs is about 20.

COMPANIES ACT.

Sir GEORGE HAMILTON: 18.
asked the President of the Board of Trade if he will state the number of public companies who on 2nd June were still in default in their statutory obligation to lodge annual accounts and balance sheets; and will he give the reasons why noncompliance with the provisions of the Act is permitted to continue for so long a period as five months?

Mr. W. GRAHAM: The number of outstanding cases of default on the 2nd June was about 200. With regard to the second part of the question I would refer the hon. Member to the full answer which I gave him on 6th May.

SAFEGUARDING DUTIES (LACE INDUSTRY).

Sir HENRY BETTERTON: 19.
asked the President of the Board of Trade whether he can now state whether he is prepared to grant an inquiry into the position of the lace trade?

Mr. W. GRAHAM: I do not consider that such an inquiry is necessary.

Sir H. BETTERTON: Will the right hon. Gentleman say on what date he communicated the decision to the trade?

Mr. GRAHAM: I think it was communicated to-day, not to the trade, but to the trade union deputation.

Major the Marquess of TITCHFIELD: Why did the right hon. Gentlemen keep the whole trade in suspense during the Election? Now that the electors of Nottingham have given their verdict, will he reconsider his decision?

Oral Answers to Questions — BRITISH ARMY.

RATION ALLOWANCES.

Mr. FREEMAN: 25.
asked the Secretary of State for War whether he has now been able to reconsider the question of the proposed reduction in ration allowances to non-commissioned officers and men on leave?

The SECRETARY of STATE for WAR (Mr. T. Shaw): As I have already explained, this reduction in the rate of ration allowance issuable on furlough forms part of a general revision of allowances, which was nearing completion more than two years ago, and which was designed to remedy, by a redistribution of the money available on a more logical and equitable basis, a number of anomalies and hardships affecting all ranks. I have considered in every way and with the utmost sympathy the possibility of re-introducing the higher rate of ration allowance on furlough, but I very much regret that I cannot do so without upsetting the whole revision of allowances of which it forms an integral part.

Mr. FREEMAN: Is my right hon. Friend aware that this means a drop of between 30 per cent. and 40 per cent. to these men and officers? If my right hon. Friend cannot restore the original position, can he not do something to meet this serious decrease?

Mr. SHAW: I am quite willing to go into the case and to reconsider the whole matter, but I cannot give any promise of any kind; neither can I give a promise that a very quick decision will be possible.

WAR CEMETERY, ETAPLES.

Mr. REMER: 26.
asked the Secretary of State for War if his attention has been called to the battered state of the Union Jack in the British War cemetery at Etaples; and what steps are taken to ensure that the national flag is maintained in a proper state?

Mr. SHAW: The state of the flag had already been reported to the Imperial War Graves Commission and arrangements are being made to replace it as quickly as possible.

Mr. REMER: Will the right hon. Gentleman take steps so that a tattered Union Jack does not exist in future in any of the British war cemeteries?

Mr. SHAW: I think that the work of the War Graves Commission is exceptionally well done, and I am sure that they can be relied upon to see that these things are remedied as quickly as the damage takes place.

TATTOOS.

Lieut.-Commander KENWORTHY: 27.
asked the Secretary of State for War what are the reasons for the instructions by the Army Council to those responsible for the programmes of military tattoos forbidding the presentation of episodes illustrating modern warfare?

Mr. SHAW: The Army Council considered that the memories of the Great War were too vivid and too recent to permit of representation, in pageant or tableau, of incidents connected with it.

Lieut.-Commander KENWORTHY: Is my right hon. Friend aware of the recent great popularity of most realistic war plays, and does he not think that the public are entitled to see the heroic deeds of our Army in recent years instead of only those relating to long ago?

Mr. SHAW: I can consider and have considered all that, but I cannot possibly agree to this demand, which is quite the opposite of other demands that I receive that no military display of any kind should be given.

TERRITORIAL CAMPS (OFFICERS' PAY).

Sir F. HALL: 28.
asked the Secretary of State for War if he will state the nature of any alteration that has been made during the past few months in the rule that officers of the Territorial Army, whilst attending voluntary week-end camps, are entitled to pay equivalent to that of regular officers?

Mr. SHAW: The hon. and gallant Member is, I think, under a misapprehension. Under the regulations, the decision whether pay and allowances should be granted at voluntary week-end camps rests with the General Officer Commanding, who has to meet the cost of such pay and allowances as he may authorise from the fixed sum allotted to him for the training of Territorial troops in his Command. There has been no recent change in this rule.

Sir F. HALL: Is it not the case that a change was made in September of last year in paragraph 625 of Territorial
Army regulations and is the right hon. Gentleman aware that a sergeant-major at a week-end camp in these circumstances would be getting more in pay and allowance than a major; and does he think that that is reasonable or right?

Mr. SHAW: I can only reply to the question which has been asked me, and say that my advice is that no alteration has been made with regard to voluntary week-end camps.

Sir F. HALL: Will the right hon. Gentleman look into the point to which have referred in connection with paragraph 625?

Mr. SHAW: Certainly, with pleasure.

FORTS, SOUTHERN IRELAND.

Lieut.-Colonel HENEAGE: 29.
asked the Secretary of State for War what steps are being taken to improve the amenities of their stations for the soldiers stationed in the forts in Southern Ireland?

Mr. SHAW: Services for the general improvement of the accommodation of the troops in the South Irish Coast Defences are considered on their merits with similar services for other stations. Considerable improvements have been made there in the past few years and provision has been made in the current Estimates for continuing this work.

Lieut.-Colonel HENEAGE: Are the amenities and the housing conditions and so on equal to those which would be available in this country?

Mr. SHAW: As I have not made a personal inspection I cannot say, but I am assured by my advisers that everything is being done to remedy any grievances which may exist.

Lieut.-Colonel HENEAGE: Will the right hon. Gentleman consider going over there and seeing these places for himself?

Mr. SHAW: Certainly.

RECRUITING.

Captain P. MACDONALD: 31.
asked the Secretary of State for War whether, with a view to improving recruiting returns, he will consider the practice of recruiting marches by county regiments in their territorial areas during the summer months?

Mr. SHAW: I can assure the hon. and gallant Member that this method of recruiting has not been overlooked by the military authorities, but experience has shown that the direct results obtained are small: and the interference with training and the cost involved by these marches render unjustifiable their adoption frequently or on a large scale.

MALTA (GARRISON).

Sir N. GRATTAN-DOYLE: 32.
asked the Secretary of State for War what units of the Army are stationed at Malta; and whether it is proposed to make such changes in respect of the future as will avoid the duty of garrisoning Malta?

Mr. SHAW: There are at present in Malta two British infantry battalions and one Maltese infantry battalion together with ancillary troops. Two additional infantry battalions, which form part of the normal establishment of the troops in Malta, are temporarily serving in Palestine. The answer to the second part of the question is in the negative.

Sir N. GRATTAN-DOYLE: Are there any changes in contemplation in the disposition of the forces?

Mr. SHAW: No changes of a striking character are in contemplation at the moment.

Sir N. GRATTAN-DOYLE: Are there any changes, whether of a striking character or not?

OFFICERS' TRAINING CORPS.

Lieut.-Commander KENWORTHY: 33.
asked the Secretary of State for War whether his attention has been drawn to the fact that service in the Harrow officers' training corps is compulsory; and whether he has had any recent report of its discipline and efficiency?

Mr. OLIVER BALDWIN: 34.
asked the Secretary of State for War with regard to the trouble in the Harrow School officers' training corps, if he will inquire whether that officers' training corps is a compulsory organisation; and, if so, whether he will withdraw the State grant from the military organisation at that school?

Mr. EDE: 39.
asked the Secretary of State for War in how many schools to which he makes a grant for the officers'
training corps membership of such corps is compulsory; if he sanctions such compulsion; and what steps he will take to bring his views to the notice of the school authorities?

Mr. SHAW: Arrangements for recruiting for contingents of the Junior Division of the Officers' Training Corps rest with the school authorities. So far as the Army Council are concerned, there is no question of compulsion, direct or indirect. I am, at the present time, having the whole position examined, and I am not in a position to go into greater detail on those points which depend on the result of that examination. As regards reports on the Harrow officers' training corps, these are rendered annually; that for 1930 is not yet due.

Lieut.-Commander KENWORTHY: Will the right hon. Gentleman explain how it came about that during the discussion on the Army Estimates he assured us that there was no compulsion regarding these corps?

Mr. SHAW: I did not do anything of the kind. I said that the War Office was not responsible for any kind of compulsion.

Lieut.-Commander KENWORTHY: Did not the right hon. Gentleman say that he was not aware of any?

Lieut.-Colonel ACLAND-TROYTE: Will the right hon. Gentleman consider the employment of the Eton officers' training corps in the event of further trouble at Harrow?

Mr. E. BROWN: Will the right hon. Gentleman, in taking the circumstances into his consideration, have regard to the question of whether grants ought to be given to officers' training corps where compulsion is made the rule?

Mr. SHAW: I have already said that I am examining the whole position at the present moment.

Mr. BROWN: May I have an answer to my question? Will the right hon. Gentleman take that into consideration?

Lieut.-Commander KENWORTHY: rose
—

Mr. SPEAKER: Mr. Ede.

WAR OFFICE LAND.

Mr. EDE: 37.
asked the Secretary of State for War how many acres of land his Department have in Selborne and Kingsley, in the county of Southampton; how many acres are unenclosed; how many were at any time subject to rights of common; and when the common rights were extinguished?

Mr. SHAW: The War Department land in Selborne and Kingsley parishes consists of about 1,680 acres, of which about 630 acres are unenclosed. 1,068 acres were at some time subject to common rights, and of this area the common rights over 380 acres were extinguished by award under the Enclosure Acts prior to acquisition by the War Department and over about 58 acres by agreement with the commoners after acquisition. Such common rights as exist over the 630 acres still unenclosed have not been extinguished.

Mr. EDE: Is it proposed by the War Office to retain the whole of this land in their occupation for the present?

Mr. SHAW: I could not give a definite answer to that question, because the War Office deals with its land as the necessities of the case demand.

Mr. EDE: 38.
asked the Secretary of State for War if he will undertake that, in future, before the freehold of any unenclosed land owned by his Department is sold, he will consult with the local authorities as to the best use to which such land can be put in conjunction with their town-planning schemes?

Mr. SHAW: It has been decided that in future, when it is proposed to sell the freehold of unenclosed land belonging to the War Department, the county or county borough council concerned shall receive the earliest possible intimation in order to afford them the opportunity of entering into negotiations for purchase by private treaty.

Mr. KIRKWOOD: Are we to take it, then, that the councils will have the first claim in regard to the purchase of land?

Mr. SHAW: The hon. Member must take the answer exactly as I have given it—that councils will be given the earliest possible information and be given the fullest possible facilities for making any representations which they choose to make.

Oral Answers to Questions — RUSSIA.

BRITISH TANKS.

Lieut.-Colonel HENEAGE: 30.
asked the Secretary of State for War whether his attention has been called to the fact that the Russian Government is attempting to purchase tanks in this country for cash; and whether he has taken steps to safeguard British interests in order to see that plans for the latest modern tanks are not handed over into the possession of a foreign country?

Mr. SHAW: As regards the first part of the question, I would refer the hon. and gallant Member to the reply given on 28th May to the hon. and gallant Member for Gainsborough (Captain Crookshank) by my right hon. Friend the President of the Board of Trade, a copy of which I am sending to him. As regards the second part, the hon. and gallant Member may rest assured that steps are taken to protect British military interests.

Sir N. GRATTAN-DOYLE: If the Soviet Government are able to pay cash for tanks why can they not afford to pay cash for other—[Interruption.]

PROPAGANDA.

Sir K. WOOD: 59.
asked the Secretary of State for the Home Department whether he can now state what action he proposes to take on the report furnished him by Scotland Yard on the result of their investigations into the recent sworn statement of M. Sava Popovitch, the Serbian artist, on the activities of Soviet secret agents in London?

The UNDER-SECRETARY of STATE for the HOME DEPARTMENT (Mr. Short): My right hon. Friend cannot at present add anything to the reply which I gave on his behalf on the 22nd May.

Sir K. WOOD: Can the hon. Gentleman give any indication when he will be able to reply?

Mr. SHORT: I cannot say.

Oral Answers to Questions — POST OFFICE.

WIRELESS RECEIVING LICENSES.

Mr. DAY: 40.
asked the Postmaster-General the number of wireless licences at present in force; and the number of these that are for portable wireless sets?

The POSTMASTER-GENERAL (Mr. Lees-Smith): The number of wireless receiving licences in force on 30th April last was 3,117,000. There are no statistics available showing how many licensees use portable receiving sets.

Mr. DAY: Is the right hon. Gentleman considering the question of having on applications for licences for wireless receiving sets a statement whether they are portable or stationary sets?

Mr. LEES-SMITH: No, Sir, I see reason for doing so.

INVESTIGATION BRANCH.

Mr. DAY: 41.
asked the Postmaster-General whether the detective and police staff employed by the Post Office has been increased during the 12 months to the last convenient date; and will he give particulars?

Mr. LEES-SMITH: During the year ended 30th April last the staff of the Post Office Investigation Branch has been increased by an addition of four assistants.

Mr. DAY: Has any special provision been made for mails travelling by train?

Mr. LEES-SMITH: We have since the beginning of the year instituted eight prosecutions, all of which have been successful.

BRITISH BROADCASTING CORPORATION (CHAIRMAN).

Captain P. MACDONALD: 44.
asked the Postmaster-General whether he is yet in a position to intimate the name of the person to be the new chairman of the British Broadcasting Corporation?

Mr. LEES-SMITH: The Prime Minister has recommended the Right Honourable John Henry Whitley for appointment by the Crown as Chairman of the British Broadcasting Corporation.

LONDON NAVAL TREATY.

Mr. MANDER: 45.
asked the Prime Minister when it is proposed to ratify the London Naval Treaty?

The PRIME MINISTER (Mr. Ramsay MacDonald): Legislation will be required to implement some of the obligations
assumed by His Majesty's Government in the United Kingdom under the London Naval Treaty, and I, therefore, cannot yet make a definite statement as to date of ratification?

Mr. MANDER: Will the right hon. Gentleman bear in mind that this Treaty is supported by the overwhelming majority of the people of this country?

CHANNEL TUNNEL.

Mr. L. SMITH: 46.
asked the Prime Minister if he can now make any statement as to the decision of the Committee of Imperial Defence with regard to the Channel Tunnel scheme?

The PRIME MINISTER: I am not yet in a position to do so.

Mr. SMITH: Will the right hon. Gentleman's promised statement on this important matter be much longer delayed?

The PRIME MINISTER: I promised to do my best to make a statement before Whitsuntide, and that holds good.

Mr. MILLS: Will the Prime Minister assure the House that before the question is disposed of it will not be turned down merely on the report of the Committee of Imperial Defence?

CUSTOMS AND EXCISE NOTICE.

Lieut.-Colonel HENEAGE: 48.
asked the Chancellor of the Exchequer whether he is aware that notice No. 37 Sec. 41,831/1929 was sent out by the Commissioners of Customs and Excise registered to doctors; how many were sent out, and at what cost for registration alone; and what is the object of registering this leaflet?

The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden): The Commissioners were advised that it was desirable to ensure that the contents of the notice, to which the hon. and gallant Member refers, were effectively brought to the knowledge of the persons concerned, and they were therefore either delivered personally, where this was practicable, or were sent by registered post. Particulars of the numbers delivered by post and, in
consequence, the cost of registration, cannot be ascertained without undue labour.

TOBACCO DUTY.

Mr. CHRISTIE: 49.
asked the Chancellor of the Exchequer whether, in view of the fact that nicotine for horticultural purposes is made of tobacco which has been subject to heavy duty, he will give a rebate of all or part of the tax on all tobacco used for this purpose?

Mr. P. SNOWDEN: The hon. Member appears to be under some misapprehension. The law already provides for the payment of a drawback of duty on stalks, shorts and other tobacco refuse used for the manufacture of preparations for horticultural purposes.

ESTATE DUTY (INSURANCE POLICIES).

Mr. A. M. SAMUEL: 50.
asked the Chancellor of the Exchequer whether he can give a rough estimate of the total amount of Estate Duty received by the Exchequer in any one of the last five years, arising from the inclusion in deceased estates of the value of the life insurance policies due to deceased persons upon whose estates duty was payable; if so, to what extent the aggregation of life policies with estates has increased on average the percentage rate of duty upon deceased estates; and, if such information is not available, will he have an approximate estimate made for the guidance of the Committee before the conclusion of the Committee stage of the Finance Bill?

Sir BASIL PETO: 51.
asked the Chancellor of the Exchequer what proportion of the yield of the Estate Duties is due to the addition to the total of the estate of the proceeds of insurance policies on the life of the deceased holder of the estate?

Mr. P. SNOWDEN: Table 18 of the recently published 72nd Report of the Commissioners of Inland Revenue (Command Paper No. 3500) contains a classification of all property coming under charge to Estate Duty for the year 1928–29 and the amount of insurance policy moneys is shown separately, divided by ranges of estates. Of a total gross capital value of £563¾ millions
coming under charge that year insurance policy moneys accounted for £18,650,000, that is 3.3 per cent. of the total. It is estimated that the amount of duty levied on the policy moneys was about £1,600,000, representing about 2.2 per cent. of the total yield of duty for the year. But I fear that it is quite impossible to frame any such estimate as is asked for in the latter part of the question by the hon. Member for Farnham (Mr. A. M. Samuel).

Mr. SAMUEL: The right hon. Gentleman admits that it has put up the average percentage of Death Duties?

Mr. SNOWDEN: Certainly, but the argument is that there is no reason why these insurance policies should be separated from the total of the estate and charged separately. The hon. Member will surely realise, if that were done, what an opening for evasion there would be.

Mr. SAMUEL: The right hon. Gentleman is under a misapprehension; does he realise that the aggregation of increases in life policies does benefit the revenue?

Mr. SNOWDEN: Most certainly.

INCOME TAX-PAYERS.

Major NATHAN: 52.
asked the Chancellor of the Exchequer his estimate of the number of Income Tax-payers within each of the following or any other convenient income groups in the revenue year 1929–30: under £500, £500 to £1,000, £1,000 to £2,000, £2,000 to £5,000, £5,000 to £10,000, £10,000 to £25,000, £25,000 to £50,000, £50,000 to £100,000, and over £100,000?

Mr. P. SNOWDEN: No statistics are available of the distribution of incomes not exceeding £2,000 per annum. The hon. and gallant Member will find particulars of the incomes exceeding £2,000 in the Super-tax statistics given in Table 63 of the 72nd report of the Commissioners of Inland Revenue (Command Paper No. 3500).

INDUSTRIAL ASSURANCE.

Sir B. PETO: 54.
asked the Financial Secretary to the Treasury whether his attention has been called to the inquiry
by the deputy industrial insurance commissioner at Cardiff into the allegations against the Royal Liver Friendly Society of not giving paid-up policy holders their rights under the Industrial Assurance Act, 1923; and whether, seeing that this society do not advise policy holders of their rights to free policies and surrender values on forfeiture notices served upon insurers who are in arrear in the payment of premiums, he will give further consideration to the question of introducing amending legislation to make this compulsory?

Mr. PETHICK-LAWRENCE: The answer to the first part of the question is in the affirmative. As regards the remainder, I would refer the hon. Member to the reply I gave him last Thursday.

ACCIDENTS BY LIGHTNING (COMPENSATION).

Mr. FREEMAN: 57.
asked the Financial Secretary to the Treasury whether his attention has been called to an accident to Mr. Walter Price, the Rheol, Llandrindod Wells, Radnorshire, by a stroke of lightning which killed his two horses and seriously injured himself on 25th May, 1930; and whether he will consider instituting a fund from which compensation for this or similar accidents can be claimed?

Mr. PETHICK-LAWRENCE: The answer to the first part of the question is in the negative. With regard to the second part, I regret that I am unable to accept the suggestion of my hon. Friend.

Oral Answers to Questions — AGRICULTURE.

CIDER (NATIONAL MARK).

Major COLFOX: 62.
asked the Minister of Agriculture whether it is intended to grant a National Mark for cider; and whether the use of this mark will be limited to cider produced only from apples grown in this country?

The PARLIAMENTARY SECRETARY to the MINISTRY of AGRICULTURE (Dr. Addison): The Ministry has now under discussion with the National Farmers' Union and with the National Association of Cider Makers a scheme
for establishing, in association with the National Mark, grades of quality for cider made in England and Wales. It is proposed to limit the scope of the scheme to cider produced from fruit grown in England and Wales.

CREDITS.

Mr. CHRISTIE: 64.
asked the Minister of Agriculture if his attention has been called to the small amount of the loans granted by the banks under the short-term credit scheme of the Agricultural Credits Act, 1928; whether he is aware that this amount is inadequate for the carrying on of the industry; and whether he will provide the banks with funds so that the amount available for short-term loans will be largely increased?

Dr. ADDISON: The total number of agricultural charges registered under Part II of the Agricultural Credits Act, 1928, is slightly in excess of 2,000. I am not able to state the gross amount of the advances secured by these charges, but it represents only a fraction of the total amount of bank advances to farmers. The answer to the last part of the question is in the negative.

LONDON BUILDING ACTS.

Mr. A. M. SAMUEL: 70.
asked the Minister of Health what steps he is taking to review the London Building Acts so as to eliminate out-of-date provisions and restrictions which act as a clog upon building and employment in the building trades and their co-operant industries?

Mr. PARKINSON (Lord of the Treasury): The London Building Acts are private Acts of Parliament, and it rests with the London County Council to propose to Parliament any measures for bringing them up-to-date.

Mr. SAMUEL: Will the hon. Member bring this matter to the notice of the London County Council, so that this obstacle to building and employment may be removed by the waiving of obsolete provisions?

Mr. HOLFORD KNIGHT: Is my hon. Friend aware that the London County Council have introduced a Bill which is now under the consideration of a Joint Committee of both Houses?

DOMINIONS AND COLONIAL OFFICES.

Mr. MATHERS: (by Private Notice) asked the Prime Minister if he proposes to make any change in the administration of Dominion affairs preparatory to the meeting of the Imperial Conference?

The PRIME MINISTER: The approach of the Imperial Conference and the nature of its business necessitate a separation of the offices of the Dominions and Colonies, which has already been made by declaration but not in fact. At the moment there are two Under-Secretaries of State for these Offices, but they still have one head in common. I propose now to put a head over each Office. This ought to have been done before, but it was so inconvenient that my predecessors as well as myself delayed it. Now, in preparation for the Imperial Conference, it must be done.
The economic relations between the Dominions and ourselves have always been a matter of great interest to this Government. There have been exchanges of views on the subject with the Dominions, and the whole question is being thoroughly examined in preparation for what will be one of the most important discussions at the Imperial Conference. I am anxious that the contacts already established between the Lord Privy Seal on the one hand and Dominion Ministers on the other should be further and more effectively used both for inter-Imperial purposes and in connection with our own unemployment policy.

Sir F. HALL: Is that the way out? [Interruption.]

The PRIME MINISTER: I have therefore decided to ask the Lord Privy Seal to take the Dominions, and he has consented. That will necessitate a readjustment of the machinery set up for dealing with unemployment, but that will be announced in due course.

Mr. CHURCHILL: Are we to gather from the Prime Minister's statement that it is intended to create a salaried post of the first magnitude as an addition to the Cabinet offices?

The PRIME MINISTER: It was intended some years ago that the Dominions, on account of their new position
and constitution, should be separated from the Colonies, and after the decisions of the Imperial Conference of 1926 it is absolutely impossible for this country to meet another Imperial Conference without a division having taken place.

Mr. CHURCHILL: Will the right hon. Gentleman, in making these important constitutional propositions to the House in due course, consider whether, by the suppression of other offices, he can assure us that no additional charge will fall on the Exchequer?

The PRIME MINISTER: I can assure the right hon. Gentleman that that discovery has not escaped my observation.

Major COLFOX: Are we to assume that the Lord Privy Seal is to get another job?

HON. MEMBERS: Answer!

Sir F. HALL: Is that a reward for his success?

Mr. STANLEY BALDWIN: May I take it there will be a Supplementary Estimate this Session for the salary?

The PRIME MINISTER: That I am not very sure about. If it is necessary, it will be done.

Mr. CHURCHILL: But you cannot get a penny out of the Exchequer without it.

BILLS REPORTED.

EPSOM RURAL DISTRICT COUNCIL BILL [Lords].

Reported, with Amendments, from the Local Legislation Committee (Section A); Report to lie upon the Table, and to be printed.

GUILDFORD RURAL DISTRICT COUNCIL BILL [Lords].

Reported, with Amendments, from the Local Legislation Committee (Section A); Report to lie upon the Table, and to be printed.

WEST BROMWICH CORPORATION BILL [Lords].

Reported, with Amendments, from the Local Legislation Committee (Section B); Report to lie upon the Table, and to be printed.

MESSAGE FROM THE LORDS.

That they have agreed to—

London Electric, Metropolitan District, Central London, and City and South London Railway Companies Bill (Certified Bill),

Croydon Corporation Bill (Certified Bill),

Burnley Corporation Bill,

Tees (Newport) Bridge Bill (Certified Bill),

Coventry Corporation Bill (Certified Bill), with Amendments.

Amendments to—

Mid Kent Water Bill [Lords] (Certified Bill), without Amendment.

That they have passed a Bill, intituled, "An Act to amend and consolidate the enactments relating to the drainage of land; and for purposes in connection with such amendment." [Land Drainage Bill [Lords.]

Also a Bill intituled, "An Act to consolidate the enactments relating to streets and buildings in London." [London Building Bill [Lords.]

Also a Bill, intituled, "An Act to provide for the transfer to the county council of the administrative county of Southampton of the undertaking of the company of proprietors of Bursledon bridge and roads; and for other purposes." [Southampton County Council (Bursledon Bridge) Bill [Lords.]

Also a Bill, intituled, "An Act to authorise the Shoreham Harbour Trustees to construct works; to increase their borrowing powers; and for other purposes." [Shoreham Harbour Bill [Lords.]

Also a Bill, intituled, "An Act to authorise the Ascot District Gas and Electricity Company to raise additional capital; and for other purposes." [Ascot District Gas and Electricity Bill [Lords.]

And also, a Bill, intituled, "An Act to authorise the Torquay Tramways Company, Limited, to discontinue their existing tramways and to provide and run trolley vehicles; and for other purposes." [Torquay and Paignton Traction Bill [Lords.]

London Electric, Metropolitan District, Central London, and City and South London Railway Companies Bill (Certified Bill),

Lords Amendments to be considered To-morrow, pursuant to the Order of the House of 11th December.

Croydon Corporation Bill (Certified Bill),

Lords Amendments to be considered To-morrow, pursuant to the Order of the House of 11th December.

Tees (Newport) Bridge Bill (Certified Bill),

Lords Amendments to be considered To-morrow, pursuant to the Order of the House of 11th December.

Coventry Corporation Bill (Certified Bill),

Lords Amendments to be considered To-morrow, pursuant to the Order of the House of 11th December.

London Building Bill [Lords],

Southampton County Council (Bursledon Bridge) Bill [Lords],

Shoreham Harbour Bill [Lords] (Certified Bill),

Ascot District Gas and Electricity Bill [Lords],

Torquay and Paignton Traction Bill [Lords],

Read the First time; and referred to the Examiners of Petitions for Private Bills.

Orders of the Day — FINANCE BILL.

Further considered in Committee [Progress, 27th May].

[Mr. ROBERT YOUNG in the Chair.]

CLAUSE 6.—(Amendment with, respect to duties on licences for mechanically propelled vehicles.)

Lieut.-Colonel Sir A. LAMBERT WARD: I beg to move, in page 4, line 5, to leave out Sub-section (1).
I am glad to see the Minister of Transport in his place, as I want to obtain some elucidation as to the actual effect of this Clause. It is one of those instances of legislation by reference which have recently become so common. Probably there is no other way of referring to a Section in a previous Act. At the same time, it does make it more difficult for the ordinary back bench Member to understand what the effect is likely to be. I therefore, particularly want to ask the Minister of Transport if he can explain exactly what the effect of this Clause will be upon the various classes of motor vehicles which will come under it. I have referred to the original Act, and it seems to me that there are three, or possibly four classes of motor vehicles which will be affected by Clause 6 of this Bill. The first class of motor vehicle which apparently will be affected by the Clause is the rather obsolete type of what used to be called the electric brougham, which relies for its motive power upon a storage battery carried in the chassis, which has to be charged separately and independently of the vehicle, and is charged almost invariably when the vehicle is at rest. The only tax for that vehicle has hitherto been £6 but as that type has almost become obsolete, and I think probably in future the only instances you will see of it will be found in local museums, probably parked with the old hansom cab and the chariot, I cannot see that this Clause, from that point of view is of very much importance.
There are one or two other classes of motor vehicles upon which this Clause is likely to bear very heavily, and it seems to me that there is a chance that engineering initiative may be restricted,
and this may have the effect of deterring enterprise and invention from bringing out an improvement in the type of motor vehicle which we see upon the streets to-day. A short time ago experiments were made with a motor vehicle with what was known as an electric transmission. Transmission in that case was conveyed from the engine to the drive by means of an electric cable, much on the lines of the American battleship. The petrol engine drives a dynamo, and the power is conveyed by an electric cable to a motor in the back axle, thereby dispensing with the cardan shaft type of drive. This Clause, in my opinion, will prevent any further development of that type of drive, and it seems to me, in view of the way in which this country has fallen behind in the motor manufacturing world, that it is rather a pity that anything should be done which will deter British invention and initiative from bringing out a new type of motor car, which might do much to re-establish the British motor industry in the position which it ought to occupy in the markets of the world.
The effect of this Clause will be to charge a full rate of tax on that type of vehicle; in fact, it will charge rather more on that type, because it necessitates the use of a rather large slow-running engine, and you cannot obtain quite the same efficiency from a dynamo driven by a small quick-running engine, which is almost exclusively used to-day with the idea of avoiding as much of the road tax as is possible. This Clause will have the effect of checking any development of invention in that direction, and, in view of the unsatisfactory position which the motor industry holds to-day in the markets of the world, it seems to me a, pity that that should be the case. I should like to know from the Minister of Transport whether that is his opinion, and, if so, whether it is not advisable to give temporarily, at any rate, encouragement to the vehicle fitted with the electric drive by allowing it either temporarily or permanently to benefit by the reduced duty in the hope, as time goes on, that that may become a standardised form of motor vehicle. As experiments with this vehicle have been largely carried out in this country, I think the motor industry in this country would receive the full benefit of any concession which the hon. Gentleman
might grant in the direction of not making this particular Clause apply to that type of motor vehicle.
I should also like to know from the hon. Gentleman what are the reasons for perpetuating, under the Clause, as fax as I can see, the particularly favoured position which the electric tramcar occupies at the present time. In the opinion of many people to-day, the electric tramcar, if not obsolete, is at any rate obsolescent, and anyone who drives about London to-day must realise to what a large extent the traffic congestion from which we suffer is due to the electric tramcar, which is the only vehicle which has a right to stop in the middle of the road and disgorge its passengers to the imminent danger of those passengers, and causing great delay to the passing traffic. No other vehicle has a right to proceed slowly in such a position—

The CHAIRMAN: I am afraid that the points which are now being raised by the hon. Baronet are not in order on this Clause.

Sir A. LAMBERT WARD: I was simply pointing out that this Clause would perpetuate the favoured position of the electric tramcar.

The CHAIRMAN: Tramcars are not dealt with in this Clause.

Sir A. LAMBERT WARD: My argument is that this Clause perpetuates the position which the electric tramcar occupies with regard to freedom from Road Fund taxation.

The CHAIRMAN: That may be so, but the question whether or not tramcars should be taxed does not arise under this Clause.

4.0 p.m.

Sir A. LAMBERT WARD: In those circumstances, of course, I bow to your Ruling, and will not continue the argument. There was one other vehicle as to which I should like the position under this Clause defined by the hon. Gentleman, and that is the comparatively new trolley-car or trackless tram. I should like to know from the Minister of Transport whether that is specially included under this Clause, and, if so, what are his reasons for including it? It is possible that the electric tramcar, travelling as it does upon a line of rails, laid at the expense of the owners, might, or
should, be favoured in the matter of the road tax, but I cannot see any reason why the trackless tram should be placed in the same favoured position, and I should like to hear the hon. Gentleman's reasons for introducing a Clause which will have those effects.

The MINISTER of TRANSPORT (Mr. Herbert Morrison): I am very glad, Mr. Young, that you have not encouraged us to proceed with the discussion on the merits of the tramcar, which is a very excitable subject, but the hon. and gallant Member may be assured that it has nothing whatever to do with this Sub-section, and, as a matter of fact, the trolley omnibus has nothing to do with it either. They are taxed on the seating capacity, and are in a different category from the vehicles with which the Committee is now dealing. The Sub-section is related to quite a restricted point, and, in reality, a very simple point. The First Schedule to the Finance Act, 1926, which came into operation on 1st January, 1927, gave a concession to a certain class of vehicles, namely, a preferential rate amounting to 50 per cent. This concession was given—certainly it was intended by the framers of the Finance Act, 1926, only to be given—to electrically propelled goods-carrying vehicles, and the only ground of that concession was—and this is, of course, very important—that these vehicles were slow running, they had a very restricted radius of action, and their annual mileage was, therefore, substantially lower than that of the ordinary petrol-driven vehicle.
In view of that fact—and it was admitted by everybody that the electrically-propelled vehicle was not doing the road damage that the petrol vehicle was doing—that concession of 50 per cent. was made, but, in the early part of 1927, the inventors got to work, and Messrs. Tilling-Stevens brought out their petrol-electric goods vehicle. Those vehicles were electrically-propelled, or, at least, it was claimed that they were electrically-propelled vehicles within the meaning of the Finance Act, 1926, and a test action arose, because the Kent County Council, under the instructions of the Minister of Transport for the time being, refused to recognise the Tilling-Stevens petrol-electric vehicle as an electrically-propelled vehicle within the meaning of the Act of 1926.
As a result, an action was taken in the Courts on the initiative of Tilling-Stevens. The case was heard on 2nd May, 1928, when Mr. Justice Clauson gave the case to Messrs. Tilling-Stevens, and the Government of the day lost their case on the wording of the Finance Act, 1926. The case went to the House of Lords, where the Government did not win, although they did win in one of the Courts. Finally, therefore, the case was awarded against the Government of the day. It is an experience which frequently happens, that the intention of the Government and of Parliament in framing an Act sometimes goes wrong, because of a subsequent invention, or because of something which was not visualised at the time. As a matter of fact, the Tilling-Stevens petrol-electric vehicle is differentiated from an ordinary electrically-driven vehicle by the fact that the primary motor power is an ordinary internal combustion petrol engine. That engine is connected with an electric dynamo, and the electricity generated in the dynamo is transmitted to an electric motor. The electric motor drives the rear wheels of the car through a cardan shaft and differential gear, instead of the driving-power being derived from storage batteries charged from a source external to the vehicle. The vehicles affected do not include public service vehicles carrying passengers, which come under another category.
It is clear that the concession is given only because of the lesser damage to the highway done by the electrically-propelled vehicle. As a matter of fact, the petrol-electric vehicle, which can move as fast as the ordinary petrol vehicle, and can go distances which the ordinary petrol vehicle can go, clearly is doing the same amount of damage to the highway as the ordinary petrol vehicle, and it is unjust as between one manufacturer and another for this vehicle to be placed in a different category; similarly, it would be unjust to treat vehicles differently because one man owned a petrol vehicle and another man owned a petrol-electric vehicle. Therefore, it seems to the Chancellor of the Exchequer and myself that they should be put in the same position. Hon. Members who were here will remember that in the last Parliament it was the intention of the Chancellor of the Exchequer of that day that that should
be done, but the second Finance Bill was not taken after the General Election.
Under this Sub-section, the vehicles which will get the benefit are goods vehicles propelled by electrical motive power derived from a source external to the vehicle, for example, trolley vehicles used for the conveyance of stores, other goods or for repair purposes in connection with a trolley-vehicle or tramway system. Obviously, their operations are severely restricted, and, in fact, they do a lot of standing about, which does not do the road damage which moving about does. The second class of vehicle which will get the benefit are goods vehicles propelled by electrical motive power derived from electrical storage batteries which are not connected to any source of power while the vehicle is in motion. Therefore, the provision of the law, as we propose to amend it, will, in reality, be exactly the same provision as was intended by the Government in the Finance Act, 1926, and it merely puts right—I will not say right, but puts back the provision as intended, but which was affected by the legal derision to which the Courts, I have no doubt quite rightly, came.
The Sub-section, as drafted, excludes from the concession in respect of electrically-propelled vehicles only the petrol-electric type of vehicle which is driven by electrical motive power derived from a dynamo carried on the vehicle. It being the desire of the Government only to revert to the intention of the Government in 1926, and as the last Government, I understand, would have brought in an identically similar provision, and, indeed, passed it into law before now, no change of policy is involved. After that explanation, I hope that the hon. and gallant Member will be in a position to withdraw his Amendment which was moved, I believe, largely to get information, which, I trust, I have given with all the fullness I could.

Captain GUNSTON: The hon. Gentleman referred us to the Finance Act, 1926. I have no doubt he referred to the First Schedule, but I cannot find any reference to the concession in regard to electrically-propelled vehicles. If the hon. Gentleman will refer to the law he will find the definition "goods or burdens," and I rather think that
passengers may be taken as a burden, and that trolley trams therefore can come in. May I further reinforce my argument by a question which I asked the Chancellor of the Exchequer? I asked him previously whether, if a tramway company changed to trackless trolleys, they paid the duty, and he replied that he could not say. Therefore, I think the Minister has not satisfied the Committee that the trackless trolley would not be included. Personally, though it would be in order to argue the question whether the trackless trolley ought to get the benefit, I cannot help thinking that if they did so it would encourage the local authorities to transform their tramways to the trackless trolley system.

Mr. CHARLES WILLIAMS: I am not at all satisfied with the Minister's explanation. He rode off on the assumption that this is the result of a sort of mistake which arose out of a previous bit of legislation, and a decision in the Courts. He also laid it down—and with this, I think, most of us will agree—that under this decision certain vehicles, by means of the decision in the Courts, escaped their fair share of the burden and the upkeep of the roads. Those who view this Government from a point of view of comparative innocence in this matter would think that that is all right, and be rather inclined to accept the Minister's statement, but the Minister in his statement pointed out that this provision had to be inserted because a certain firm had introduced an improved form of electrically-propelled vehicle.
This is really what we are doing under this Sub-section. Because a firm has brought itself up-to-date and produced a new and valuable asset to British industry, we are going to place upon them the heaviest burden. That is what he said in effect, although he did not put it in that way. He tried to make out that the reason was that they did damage to the roads, but I suspect the real reason had little or nothing to do with that. Then the hon. Gentleman tried to ride off, and say that if it had not been for certain incidents last year, it might have been done last year. We have no confirmation of that. It might or it might not, but I would like to know for certain before I, at any rate, vote for this Sub-section. Perhaps my right hon. Friend in
front of me may be able to say if there is any reason to suppose that in any circumstances this provision might have been brought in last year. I think it is probably done by the Ministry of Transport or some other section of the Government with very different motives at the back of their minds from what they put forward.
Let me come to the actual definition as laid down here. There you have a complication of words, and I do think the Committee is entitled to have some clear explanation as to what they actually mean. Apparently it is being laid down here that there are two forms of vehicles—those which get their electricity from some external source, and those which are not connected with such an external source of power. Obviously, the words "not connected" are used in order to distinguish the two classes of vehicles, and I should have thought from that that the Government clearly had two different sorts of vehicles in mind. The Minister explained that the provision with regard to vehicles not connected to an external source of supply has been put in for a particular purpose, but I am not sure whether what are known as trackless trolleys would come in under this definition or not. [HON. MEMBERS: "Hear, hear!"] I am glad to hear that some interest is taken in this important matter, because, if a mistake is made, it affects the travelling facilities of millions of people in the country, and it is the duty of the Conservative party to look after these matters.
The Minister, as I understand it, laid it down that some of these vehicles would come under this Sub-section and others would not—that if they carried passengers they would be in one class, while if they carried materials for the roads, or anything of that kind, they would be in the other class. This confusion has worried a considerable number of people on this side of the Committee, and I very much doubt whether anyone on the other side, unless it be the Minister himself, could explain quite clearly exactly what is meant. It is a very bad case of reference back to an Act of 1920, and, if this legislation is to be of a permanent character, and if we are not to have to reorganise it again next year, I think the Committee would be well advised to get the best possible legal
advice before going any further on this question. I hope, therefore, that my hon. and gallant Friend will insist, before a Division is taken, or before the Amendment is considered to be satisfactorily answered, that we should have a proper explanation of the technicalities of this Sub-section, and that the Law Officers should be here to explain these complicated and difficult points. The Minister's excuse—I think it would be unfair to put it higher than an excuse—for bringing in this provision is that it is to correct a technical legal, difficulty. If that be the case, it is quite clear that it can only be explained properly from a legal point of view, and, unless that is done, I think the Government will be once again treating the Committee with extreme discourtesy by not giving us a proper and adequate answer. I never expected the Minister to be able to deal with the matter from a technical point of view. He has done his best, but I protest most vehemently that, on an occasion of this sort, the Government should be so discourteous at this early stage to the feelings of the Committee.

Sir SAMUEL ROBERTS: The Minister gave us a most lucid explanation of this Sub-section. It was so clear to me that it revealed to my mind what I had not previously known, namely, that this is a piece of retrospective legislation which needs the most careful consideration of the House. Take the case of a trader who during recent years has purchased one of these Tilling-Stevens cars. When he bought it, the dealer probably told him that he would have to pay 50 per cent. less duty upon it than if it were purely a petrol vehicle, and behind that there was a decision of the House of Lords. Relying on the decision of the House of Lords, the man has altered his position by buying this vehicle, which he might not otherwise have bought. He has done that on the faith of the law as decided by the House of Lords, and, if Parliament now comes along and changes it, it is clearly a case of retrospective legislation which affects the position of an individual who has taken perfectly legal action in a perfectly legal way. I would ask the Minister to consider whether it would not meet the case if vehicles sold after the date of the introduction of the Budget were the only ones included, and if an exception were made
in the case of all vehicles sold to private individuals prior to the date of the introduction of the Budget.

Mr. PYBUS: I should like to say a few words in support of the point made by the hon. Member for Ecclesall (Sir S. Roberts). Not only has that point occurred to me, but I am sure also that the Minister is not aware that, by this restriction, he is retarding a very fine development in electric traction work. As the Minister knows, the object of this electric drive is to eliminate the gearbox, and everyone who lives in London knows that the real nuisance, the really noisy vehicle, is the vehicle which carries goods and which has a gear-box that is very inefficiently handled. Under the law as it stood the development of the electrically-driven vehicle, with transmission from dynamo to motor, was making good progress. It was developing in a remarkable way for goods vehicles, and not only will those who have already purchased these vehicles be hard hit by this change, but this new movement, which was making great progress, not only here but abroad, will be stifled. I hope the Minister will not, just for the sake of a cecrtain amount of revenue which will be secured from these vehicles, take a step which will hamper business, will prevent development, and will discourage those who in future set out to improve methods of traction in this country.

Captain CAZALET: I should like to ask the Minister a question. He made it perfectly clear that this provision has been inserted because of the invention of a particular type of engine after the passing of the Act of 1926, but is there really any concrete reason why this concession should not be given? After all, it has encouraged a new kind of engine, and it might have started a new industry on a small scale. The arguments of the last two speakers certainly enforce everything that has been said from this side. I understand that under this Sub-section only two kinds of vehicles will get the benefit of the exception made in the Act of 1926, namely, certain trackless trolleys when they are conveying goods, and certain electrically-propelled vehicles, also when they are conveying goods. What I should like the Minister to make clear is how much a concession of this nature would cost the Road Fund, because that, surely, is the crux of the
whole problem. If it is merely a matter of a few thousand pounds, why hamper all those industries which have bought vehicles of this kind, on the strength, as has been pointed out, of an Act of Parliament, supplemented by a decision of the highest Court of the Realm? In order to justify his case the Minister should let us know what it would cost to negative this Sub-section, and what benefit would accrue to the Road Fund.

Sir ARTHUR STEEL-MAITLAND: Two points have arisen in connection with this matter, about one of which I should like to make representations to the Minister, and about the other to ask if he will kindly make the situation clear. As to the first point, I think there is a great deal of force in the argument of my hon. Friend the Member for Ecclesall (Sir S. Roberts). It does seem very severe on any owner who has purchased, as some have, a fleet of Tilling-Stevens cars, to have an extra burden suddenly added to his running costs greatly beyond what he was legitimately entitled to expect at the time that he purchased them. In all these cases, everyone who sets out on a business takes care to ascertain as far as possible what will be the costs that he will have to meet, and, in view of those costs, what charges his customers are entitled to expect from him. Therefore, it seems, prima facie, to be rather unfair that people who have acted on the strength of a House of Lords decision, which might appear to have settled the case, to have that suddenly changed in a Clause which deals, as I gather, with one specific case. Whether it will be just so far as the future is concerned is quite a different thing. So far as these cars are more analogous to the ordinary petrol car than to a car driven by a storage battery, the case is quite arguable, and very likely the Minister is right. Upon that I express no opinion; but, as regards those who have founded themselves on the decision given in a previous case, I think there is a great deal in the contention that has been made, and I put it to the Minister that an exception should be made in the case of those cars which were constructed, licensed and in operation before the introduction of the present Finance Bill.
The other point about which I should like to ask is with regard to the classification of the cars of which the Minister spoke. I have been through the Acts with regard to this subject since an Act passed, I think in the 80's, to establish hackney carriages. Such a task is, of course, extremely complicated, because during the past few years there have been, if I remember the dates aright, an Act of 1924, which was amended by one of 1926, amended again by one of 1927, and yet again by one of 1928; while even in the index to the Statutes in force there is not any one heading under which they can be traced, but you are badgered about from one heading to another, and it took about an hour's work even to trace the Acts of Parliament which are involved in this matter. I am sure that the Ministry of Transport knows that what I am saying is true. I used to be an expert in legislation by reference, and I acknowledge my fault, but I am bound to say that this is worse than anything of which I was guilty in past days. In those days, as I have remarked before in this House, I did issue a Paper, when I was asked to do so, stating what the changes were and endeavouring to make them clear.
I gather from the Minister that you really get two categories of vehicles into which electrical propulsion enters. Perhaps he will correct me if I am wrong, but I think the first category is one in which the vehicle is a trolley propelled by electrical power from outside, being a trolley which carries goods, and only goods, and of which, as the Minister says, the sphere of action is very limited. The other class under this same category has an electrical storage battery and carries goods. What is the degree of taxation? I have endeavoured to verify it from the Acts, and it is only because of their complexity to anyone outside that I ask. They are, I presume, in a different category from the trolley-omnibus, which is taxed according to seating capacity, if it is seating capacity? What is the comparative taxation of these two? The original tax on the electrically-propelled vehicle was £6 per annum.

The CHAIRMAN: The comparative taxation does not arise on this Amendment. The point under discussion is the definition of "electrically-propelled,"
and, according to the definition, the taxation will be.

Sir A. STEEL-MAITLAND: I do not wish to travel beyond what you say is proper, but we are considering what classes of vehicles should come under this Sub-section, and whether a class of vehicles should or should not properly come under the Sub-section is really determined by the treatment it will receive if it comes under the Sub-section. Here we have words which define the classes to which the favourable terms of treatment apply, which are, first of all, propelled vehicles which get electrical motive power from an external source and the others which are driven by an electrical storage battery. The real point is whether you should have in this class of vehicles the third class to which the Tilling-Stevens kind of machine belongs. A point which is germane to this is what precise difference in advantage there is between coming within this class and the heavier taxation which they would have to bear if they were outside it. I submit that, if it is a difference between about £6 per annum and anything varying from £12 to £30 per annum according to the number of seats, it is a matter one wishes to consider in order to see how the difference is created.

Mr. HERBERT MORRISON: I think I can clear up the points that have been raised, after which I should hope the Committee would come to a conclusion. I have very great sympathy with the right hon. Gentleman's observations as to the complication of these Schedules. We all admit it, whether present or past Ministers. I imagine the right hon. Gentleman knows why the previous Government have not before now consolidated these Schedules into one. The probable reason is that it would increase the time that would have to be devoted to the Committee and Report stages of the Finance Bill. Possibly one of these days, when we have a Government that has very little legislation before the House, they may be consolidated. We have tried to simplify it by the publication of documents, and what we call a church door poster, which gives all the scales of taxation up to date, and in as simple a way as they could be given if a revised Schedule were made.
With regard to the relative advantage in taxation of the electrical vehicle
proper, the answer is quite simple. The electrical vehicle proper gets a 50 per cent. rebate on the tax it would pay if it were a petrol-electric vehicle. Hon. Members may be certain that this is in no way related to the trolley vehicle, or any passenger vehicle at all. It deals solely with the goods vehicle which is propelled by electric power. I do not know whether hon. Members have seen these vehicles, but they are very slow-moving. They are used for refuse collecting and jobs where there is constant stopping. They are not particularly economical vehicles where long journeys have to be done and considerable speeds must be achieved.
Clearly, the owner of a vehicle who bought it up to the date of the judgment has no grievance, because he bought it on the understanding that it would be taxed in the same way as the petrol vehicle. [HON. MEMBERS: "No !'] The Minister of Transport—not I, but my predecessor—and the Treasury held throughout that the proper tax upon these petrol-electric vehicles was the normal tax of the petrol vehicle, and it was not until the Courts had upset the Government of the day that anyone had a right to suppose they would get through with a lower tax. Therefore, the only man who has a possible grievance—and I will shortly show that he has none—is the man who bought it between the date of the judgment and the introduction of this Bill. But he has no grievance, because he must have known that the Government of the day, whether the last Government or this, would bring in legislation at the earliest possible date to rectify the matter and, therefore, no one has bought a vehicle under the impression that he would get this 50 per cent. rebate for any material time. [Interruption.] I do not know whether the hon. Member has any better knowledge than I have, but that is my information. Is it fair that a man who has a petrol vehicle is to be taxed 100 per cent. higher than a man with a petrol-electric vehicle, which can go as fast, do as much work and use up the roads as much as a petrol vehicle? I am surprised that it should be suggested that one vehicle, which is doing exactly the same class of work as another, should be taxed at 50 per cent. less. Clearly that would not
be fair to the operators and to the manufacturers.
I agree that the cost of such a concession, even the cost of the concession in this Amendment, would not be great at the moment, but if one looks ahead, clearly it would encourage the production of a particular type of vehicle, to which I have no objection on merits, but if it developed in a wholesale fashion, the revenue from this class of vehicle would be down by 50 per cent. within a few years' time. I am surprised that the right hon. Gentleman should associate himself with the Amendment even in the distant way he has done, because there is conclusive proof that the last Government intended to do exactly what we are doing. There was presented to the House in April, 1921, by the then Financial Secretary, a White Paper which indicated the Clauses that would be incorporated in the Finance Bill (No. 2), and we find on page 7 the following:
At the end of the said Schedule there shall be inserted the following paragraph:
'A vehicle shall not be deemed to be an electrically-propelled vehicle within the meaning of this Schedule unless the electrical motive power is derived either from a source external to the vehicle or from an electrical storage battery which is not connected to any source of power when the vehicle is in motion.'
If you compare those words with the Bill, they are exactly the same, and my reasons are exactly the same as impelled the last Government to make that proposal. Parliamentary tradition is accustomed to the knowledge that Members say in opposition things that they do not say when in office, and they say things when in office that they do not say when in opposition. I have never been in opposition, and I have no words to eat, but that is what I am told. This is really a startling example of that rather bad Parliamentary tradition. In view of the case I have made, which is really unanswerable, and in view of the fact that we are doing exactly what the last Government intended to do as recently as April of last year, I hope the Committee, having had a thorough explanation of what the provision means, will now come to a decision.

Sir LAMING WORTHINGTON-EVANS: I should not have intervened had not the hon. Gentleman put forward
an argument as if it were unassailable, which seems to me to be entirely beside the point. He was claiming that there was no hardship on those who already owned these petrol electrically-driven machines, because the Ministry of Transport decided that they ought to have been taxed in the same way as petrol-driven machines. The Ministry of Transport was wrong and the owner of the machine was right when he thought he was entitled to a 50 per cent. reduction. That is proved by the decision of the highest court in the land.

Mr. MORRISON: The right hon. Gentleman is on a wrong point. I did not say who was legally right or wrong. If the House of Lords on appeal decided that the last Government was wrong, the last Government was wrong on that point, as they were on a good many other points. But that is not the point at all. What I have said is that no one had any reason to expect that the widespread concession consequent upon the decision of the House of Lords on law could possibly stand. Therefore, there is no grievance.

Sir L. WORTHINGTON-EVANS: How could anyone who was buying a machine know what the intention of Parliament was except by reading the Act passed by Parliament? The Act gave him a 50 per cent. rebate and, on the strength of having it, he may quite well have bought a fleet of these vehicles. Then the hon. Gentleman says he was wrong because the Ministry of Transport intended that these electrically-propelled vehicles should be taxed as if they were petrol-propelled. That is not right. The House of Lords decided that the owner was right and the Ministry of Transport was wrong, and whether that Ministry of Transport was the Ministry of the last Government or of this is entirely beside the point. The owner now finds that he is to be taxed 50 per cent. more than the law required him to be taxed at the moment when he bought the vehicles. I am not in the least concerned that he should get some benefit over others who are using petrol-driven vehicles. On the contrary I am glad that he should have a benefit.
This electrically-driven vehicle is a new invention and we want to see it developed. It has many advantages over a vehicle which depends on gear-Changing.
The streets are made hideous with the noise of these heavy vehicles changing their gears when they have to stop and go forward. The electrically-driven vehicle moves much more easily and more silently than the petrol one. We really require encouragement for these vehicles, so that the inventors and experimenters may improve and standardise them, and I am very glad that they should in the meanwhile get a 50 per cent. rebate of their taxation in order that invention may be stimulated. The hon. Gentleman has made the best of a very bad case but, notwithstanding his efforts, I do not think the Government have treated us properly. Here are these Acts, five of them. I confess that I have not spent an hour, as did my right hon. Friend the Member for Tamworth (Sir A. Steel-Maitland) in searching out the history of this particular Amendment, but I take it from him that there are five Acts, each one referring to the other, and there is some confusion as to whether one vehicle or the other is included. When we started on this discussion, I thought that, unless we had the Attorney-General present, it would be impossible to come to a decision upon so complicated a matter. I compliment the Minister of Transport on having made the point clear. What is it that he has made clear? It is, that here is a vehicle which in many ways is better for London traffic than the petrol vehicle. Here is an electrically-driven engine at present enjoying 50 per cent. rebate in order to encourage experiments in these vehicles, and now the Government propose to take away that rebate. I hope that my hon. and gallant Friend will go to a Division.

Major COLFOX: I approach this problem with an unbiased mind. [Laughter.] That remark may seem singular to some hon. Members opposite, who are so prejudiced as not to allow themselves to be influenced by any debate. I am not of that kind. I came here to be influenced by the debate as it proceeds, and I am forced to the conclusion that the balance of justice is on the side of the Amendment. It is noteworthy that the justice of the Amendment has goaded even the patient oxen to rebel against their oppressive taskmasters or, rather, one of them. It is always a little difficult to know, because they are not always influenced by herd
psychology, whether the patient oxen will move in a body, or turn and rend one of their—

The CHAIRMAN: I should be obliged if the hon. and gallant Member would speak to the Amendment.

Major COLFOX: The balance of justice is on the side of the Amendment. By resisting the Amendment it seems to me that the Government are giving us one more instance of the way in which they increase unemployment by hampering an infant industry, which would no doubt grow and employ a considerable number of people if this Amendment were passed. It would also give great scope to inventive genius to carry forward inventions to simplify road traffic. The Minister of Transport has said that the people who have bought these vehicles have no reason to complain if we alter the law. Not only this Government but any Government is in a very privileged position, because when a case is contested in the Law Courts and the Government find that the decision goes against them they immediately alter the rules of the game, they alter the law, thereby getting an unfair advantage over the ordinary litigant, the private citizen, who has contested the case against them. I suppose it is inevitable, but it always seems to me very unfair that the Government should not be compelled to abide by the same rules as the ordinary individual. For my part, lamentable as it is, I should be prepared to support an alteration of the law in regard to the future, provided the Minister would give an undertaking that the position in regard to these vehicles in the past should be safeguarded. Although I admit that that would not carry out the full advantage of the Amendment, it would be part of what we desire.

Captain CAZALET: The Minister of Transport said that he could not give the exact sum that would be involved in this matter, but that it would be a small figure. Is it a matter of a few thousand pounds?

The CHAIRMAN: We are not discussing the amount of the tax on any vehicle at the moment. This is a definition part of the Clause.

Mr. ARTHUR MICHAEL SAMUEL: It is only reasonable that we should know what amount of money is in question.

The CHAIRMAN: The Amendment relates to the definition, and the tax will be the same according to the class of vehicle irrespective of the definition part of the Clause.

Sir L. WORTHINGTON-EVANS: The definition puts a limit on the tax. That is the object of the definition. The position is this, that there is a form of vehicle which has escaped a certain amount of taxation or, at any rate, it only pays 50 per cent. The object of the definition is to bring in that form of vehicle and to increase the tax by removing the 50 per cent. abatement. The question is, how much revenue that will mean.

The CHAIRMAN: That may be so, but that does not affect this Amendment.

Sir L. WORTHINGTON-EVANS: That is precisely what the Amendment is. Its object is to leave out the definition. If we leave out the definition, then 50 per cent. will be payable, and not 100 per cent. We want to know what is the difference between the 50 per cent. and the 100 per cent. In other words, what will the Amendment cost?

Mr. HERBERT MORRISON: The Sub-section limits the class of vehicles that can get the rebate. The Amendment would not limit it, but leave it as it is. Neither the Amendment nor the Sub-section in any way affects the scale of taxation.

Captain CAZALET: The Minister of Transport in his argument for not accepting the Amendment said that it would cause a shrinkage of the revenue of the Road Fund. He said that the sum was not large, but he could not tell us how much it was. Can he say whether it is a matter of a few thousands or hundreds of thousands?

The CHAIRMAN: The Minister cannot say beforehand. That is quite apart from what we are discussing now.

Mr. SMITHERS rose—

The CHAIRMAN: I have given my decision two or three times already.

Mr. REMER: My object in rising is to ask the Minister of Transport why this Sub-section is put in the Finance Bill. We have a Bill dealing with road traffic which has passed through Committee, and it would seem that this Clause ought to
be in that Bill and not in the Finance Bill.

The CHAIRMAN: Whether this Clause ought to have been in this Bill or in another Bill I do not know but, at any rate, we are discussing Sub-section (1) of Clause 6 of the Finance Bill.

Mr. REMER: If this Sub-section had been included in the Road Traffic Bill it would have been very much more to the advantage of the Committee.

The CHAIRMAN: This is the Finance Bill.

Mr. REMER: That is precisely what I was seeking to bring to the attention of the Minister. This is a Finance Bill, and under no circumstances should Clauses be put into the Finance Bill which have reference to another Bill which is before the House. The Minister of Transport has put many strange things into the other Bill.

The CHAIRMAN: The hon. Member must keep to this Bill. For the time being we have nothing to do with the other Bill or what is in the other Bill.

Mr. REMER: I appreciate that, and I obey your Ruling. May I call attention to the fact that this Sub-section ought not to be in this Bill. Where it should be, I leave the Minister to explain to himself. I protest very strongly against putting into the Finance Bill matters which have no reference of any kind to finance. I think that your ruling a few minutes ago in reply to a question by the late Financial Secretary to the Treasury showed conclusively that what I have said has a great deal of point. If I understood your ruling, it was to the effect that this is a definition Clause and, therefore, I do not think that it should be in this Bill. I enter the strongest protest against misusing the Finance Bill for matters which have nothing whatever to do with the finance of the year.

Several HON. MEMBERS rose—

Mr. HERBERT MORRISON rose in his place, and claimed to move, "That the Question be now put."

Question put, "That the Question be now put."

The Committee divided: Ayes, 278; Noes, 151.

Division No. 327.]
AYES.
[4.59 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Hall, Capt. W. P. (Portsmouth, C.)
Montague, Frederick


Adamson, W. M. (Staff., Cannock)
Hamilton, Mary Agnes (Blackburn)
Morgan Dr. H. B.


Addison, Rt. Hon. Dr. Christopher
Hamilton, Sir R. (Orkney & Zetland)
Morley, Ralph


Aitchison, Rt. Hon. Craigie M.
Harbord, A.
Morris, Rhys Hopkins


Alexander, Rt. Hon. A. V. (Hillsbro')
Hardie, George D.
Morris-Jones. Dr. J. H. (Denbigh)


Alpass, J. H.
Hartshorn, Rt. Hon. Vernon
Morrison, Herbert (Hackney, South)


Ammon, Charles George
Hastings, Dr. Somerville
Morrison, Robert C. (Tottenham, N.)


Arnott, John
Haycock, A. W.
Mort, D. L.


Aske, Sir Robert
Hayday, Arthur
Moses, J. J. H.


Attlee, Clement Richard
Henderson, Rt. Hon. A. (Burnley)
Muff, G.


Ayles, Walter
Henderson, Arthur, Junr. (Cardiff, S.)
Muggeridge, H. T.


Baker, John (Wolverhampton, Bilston)
Henderson, Thomas (Glasgow)
Nathan, Major H. L.


Baldwin, Oliver (Dudley)
Henderson, W. W. (Middx. Enfield)
Naylor, T. E.


Barnes, Alfred John
Herriotts, J.
Newman, Sir R. H. S. D. L. (Exeter)


Batey, Joseph
Hirst, G. H. (York, W. R., Wentworth)
Noel Baker, P. J.


Beckett, John (Camberwell, Peckham)
Hirst, W. (Bradford, South)
Oliver, George Harold (Ilkeston)


Bellamy, Albert
Hoffman, P. C.
Oliver, P. M. (Man., Blackley)


Benn, Rt. Hon. Wedgwood
Hollins, A.
Palin, John Henry


Bennett, Capt. Sir E. N. (Cardiff C.)
Hopkin, Daniel
Parkinson, John Allen (Wigan)


Benson, G.
Horrabin, J. F.
Perry, S. F.


Bevan, Aneurin (Ebbw Vale)
Hudson, James H. (Huddersfield)
Peters, Dr. Sidney John


Bowen, J. W.
Hunter, Dr. Joseph
Pethick-Lawrence, F. W.


Broad, Francis Alfred
Hutchison, Maj.-Gen. Sir R.
Picton-Turbervill, Edith


Bromfield, William
Isaacs, George
Pole, Major D. G.


Bromley, J.
Jenkins, W. (Glamorgan, Neath)
Potts, John S.


Brooke, W.
John, William (Rhondda, West)
Price, M. P.


Brothers, M.
Jones, F. Llewellyn- (Flint)
Pybus, Percy John


Brown, C. W. E. (Notts, Mansfield)
Jones, Henry Haydn (Merioneth)
Quibell, D. J. K.


Brown, Ernest (Leith)
Jones, J. J. (West Ham, Silvertown)
Ramsay, T. B. Wilson


Brown, Rt. Hon. J. (South Ayrshire)
Jones, Rt. Hon Leif (Camborne)
Richards, R.


Brown, W. J. (Wolverhampton, West)
Jones, Morgan (Caerphilly)
Richardson, R. (Houghton-le-Spring)


Buchanan, G.
Jones, T. I. Mardy (Pontypridd)
Riley, Ben (Dewsbury)


Buxton, C. R. (Yorks. W. R. Eliand)
Jowett, Rt. Hon. F. W.
Riley, F. F. (Stockton-on-Tees)


Caine, Derwent Hall-
Jowitt, Rt. Hon. Sir W. A.
Ritson, J.


Cameron, A. G.
Kedward, R. M. (Kent, Ashford)
Romeril, H. G.


Cape, Thomas
Kennedy, Thomas
Rosbotham, D. S. T.


Carter, W. (St. Pancras, S. W.)
Kirkwood, D.
Rowson, Guy


Charieton, H. C.
Knight, Holford
Runciman, Rt. Hon. Walter


Chater, Daniel
Lambert, Rt. Hon. George (S. Molton)
Russell, Richard John (Eddisbury)


Church, Major A. G.
Lang, Gordon
Salter, Dr. Alfred


Clarke, J. S.
Lansbury, Rt. Hon. George
Samuel, Rt. Hon. Sir H. (Darwen)


Cluse, W. S.
Lathan, G.
Samuel, H. W. (Swansea, West)


Cocks, Frederick Seymour.
Law, Albert (Bolton)
Sanders, W. S.


Compton, Joseph
Law, A. (Rossendale)
Sandham, E.


Cove, William G.
Lawson, John James
Sawyer, G. F.


Cowan, D. M.
Lawther, W. (Barnard Castle)
Scott, James


Daggar, George
Leach, W.
Scrymgeour, E.


Dallas, George
Lee, Frank (Derby, N. E.)
Scurr, John


Dalton, Hugh
Lee, Jennie (Lanark, Northern)
Sexton, James


Davies, E. C. (Montgomery)
Lees, J.
Shaw, Rt. Hon. Thomas (Preston)


Davies, Rhys John (Westhoughton)
Lewis, T. (Southampton)
Sherwood, G. H.


Day, Harry
Lloyd, C. Ellis
Shield, George William


Denman, Hon. R. D.
Logan, David Gilbert
Shillaker, J. F.


Dickson, T.
Longbottom, A. W.
Shinwell, E.


Dudgeon, Major C. R.
Longden, F.
Short, Alfred (Wednesbury)


Dukes, C.
Lovat-Fraser, J. A.
Simon, E. D. (Manch'ter, Withington)


Duncan, Charles
Lowth, Thomas
Sinclair, Sir A. (Caithness)


Ede, James Chuter
Lunn, William
Sinkinson, George


Edmunds, J. E.
Macdonald, Gordon (Ince)
Sitch, Charles H.


Edwards, E. (Morpeth)
MacDonald, Rt. Hon. J. R. (Seaham)
Smith, Alfred (Sunderland)


Egan, W. H.
MacDonald, Malcolm (Bassetlaw)
Smith, Ben (Bermondsey, Rotherhithe)


Elmley, Viscount
McElwee, A.
Smith, Frank (Nuneaton)


Foot, Isaac
McEntee, V. L.
Smith, H. B. Lees- (Keighley)


Forgan, Dr. Robert
McKinlay, A.
Smith, Rennie (Penistone)


Freeman, Peter
MacLaren, Andrew
Smith, Tom (Pontefract)


Gardner, B. W. (West Ham, Upton)
MacNeill-Weir, L.
Snell, Harry


Gardner, J. P. (Hammersmith, N.)
Macpherson, Rt. Hon. James I.
Snowden, Rt. Hon. Phillp


Gibbins, Joseph
McShane, John James
Snowden, Thomas (Accrington)


Gibson, H. M. (Lancs. Mossley)
Malone, C. L'Estrange (N'thampton)
Sorensen, R.


Gill, T. H.
Mander, Geoffrey le M.
Stamford, Thomas W.


Gillett, George M.
Mansfield, W.
Stephen, Campbell


Gossling, A. G.
March, S.
Stewart, J. (St. Rollox)


Gould, F.
Marcus, M.
Strachey, E. J. St. Loe


Graham, D. M. (Lanark, Hamilton)
Markham, S. F.
Strauss, G. R.


Graham, Rt. Hon. Wm. (Edin., Cent.)
Marley, J.
Sutton, J. E.


Gray, Milner
Mathers, George
Taylor, R. A. (Lincoln)


Grenfell, D. R. (Glamorgan)
Matters, L. W.
Taylor, W. B. (Norfolk, S. W.)


Griffith, F. Kingsley (Middlesbro' W.)
Maxton, James
Thomas, Rt. Hon. J. H. (Derby)


Griffiths, T. (Monmouth, Pontypool)
Melville, Sir James
Thorne, W. (West Ham, Plaistow)


Groves, Thomas E.
Messer, Fred
Thurtle, Ernest


Grundy, Thomas W.
Middleton, G.
Tinker, John Joseph


Hall, F. (York, W. R., Normanton)
Millar, J. D.
Toole, Joseph


Hall, G. H. (Merthyr Tydvil)
Mills, J. E.
Tout, W. J.




Townend, A. E.
Watson, W. M. (Dunfermline)
Williams, T. (York, Don Valley)


Trevelyan, Rt. Hon. Sir Charles
Watts-Morgan, Lt.-Col. D. (Rhondda)
Wilson, C. H. (Sheffield, Attercliffe)


Turner, B.
Welsh, James (Paisley)
Wilson, J. (Oldham)


Vaughan, D. J.
West, F. R.
Wilson, R. J. (Jarrow)


Viant, S. P.
Westwood, Joseph
Winterton, G. E. (Leicester, Loughb'gh)


Walkden, A. G.
White, H. G.
Wise, E. F.


Walker, J.
Whiteley, Wilfrid (Birm., Ladywood)
Young, R. S. (Islington, North)


Wallace, H. W.
Whiteley, William (Blaydon)



Wallhead, Richard C.
Wilkinson, Ellen C.
TELLERS FOR THE AYES.—


Walters, Rt. Hon. Sir J. Tudor
Williams, David (Swansea, East)
Mr. Paling and Mr. Charles


Watkins, F. C.
Williams, Dr. J. H. (Llanelly)
Edwards.




NOES.


Acland-Troyte, Lieut.-Colonel
Fermoy, Lord
Percy, Lord Eustace (Hastings)


Albery, Irving James
Fielden, E. B.
Peto, Sir Basil E. (Devon, Barnstaple)


Amery, Rt. Hon. Leopold C. M. S.
Fison, F. G. Clavering
Pilditch, Sir Philip


Astor, Viscountess
Forestier-Walker, Sir L.
Pownall, Sir Assheton


Baillie-Hamilton, Hon. Charles W.
Gault, Lieut.-Col. Andrew Hamilton
Rawson, Sir Cooper


Baldwin, Rt. Hon. Stanley (Bewdley)
Gibson, C. G. (Pudsey & Otley)
Remer, John R.


Beaumont, M. W.
Gilmour, Lt.-Col. Rt. Hon. Sir John
Rentoul, Sir Gervals S.


Berry, Sir George
Glyn, Major R. G. C.
Reynolds, Col. Sir James


Betterton, Sir Henry B.
Gower, Sir Robert
Richardson, Sir P. W. (Sur'y, Ch'te'y)


Bird, Ernest Roy
Graham, Fergus (Cumberland, N.)
Roberts, Sir Samuel (Ecclesall)


Bourne, Captain Robert Croft
Grattan-Doyle, Sir N.
Rodd, Rt. Hon. Sir James Rennell


Bowater, Col. Sir T. Vansittart
Grenfell, Edward C. (City of London)
Russell, Alexander West (Tynemouth)


Bowyer, Captain Sir George E. W.
Gretton, Colonel Rt. Hon. John
Salmon, Major I.


Boyce, H. L.
Gritten, W. G. Howard
Samuel, A. M. (Surrey, Farnham)


Bracken, B.
Gunston, Captain D. W.
Sandeman, Sir N. Stewart


Briscoe, Richard George
Hall, Lieut.-Col. Sir F. (Dulwich)
Shepperson, Sir Ernest Whittome


Brown, Col. D. C. (N'th'l'd., Hexham)
Hamilton, Sir George (Ilford)
Simms, Major-General J.


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Hannon, Patrick Joseph Henry
Sinclair, Col. T. (Queen's U., Belfast)


Buchan, John
Hartington, Marquess of
Smith, Louis W. (Sheffield, Hallam)


Burton, Colonel H. W.
Harvey, Major S. E. (Devon, Totnes)
Smith-Carington, Neville W.


Butler, R. A.
Haslam, Henry C.
Smithers, Waldron


Cadogan, Major Hon. Edward
Henderson, Capt. R. R. (Oxf'd, Henley)
Somerville, A. A. (Windsor)


Cautley, Sir Henry S.
Heneage, Lieut.-Colonel Arthur P.
Southby, Commander A. R. J.


Cayzer, Sir C. (Chester, City)
Hennessy, Major Sir G. R. J.
Spender-Clay, Colonel H.


Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.)
Herbert, Sir Dennis (Hertford)
Stanley, Lord (Fylde)


Cazalet, Captain Victor A.
Hills, Major Rt. Hon. John Waller
Stanley, Maj. Hon. O. (W'morland)


Chamberlain, Rt. Hon. N. (Edgbaston)
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Steel-Maitland, Rt. Hon. Sir Arthur


Chapman, Sir S.
Horne, Rt. Hon. Sir Robert S.
Stewart, W. J. (Belfast, South)


Christie, J. A.
Hudson, Capt. A. U. M. (Hackney, N.)
Sueter, Rear-Admiral M. F.


Churchill, Rt. Hon. Winston Spencer
Hurd, Percy A.
Thomas, Major L. B. (King's Norton)


Colfox, Major William Philip
Hurst, Sir Gerald B.
Thomson, Sir F.


Colman, N. C. D.
Iveagh, Countess of
Tinne, J. A.


Colville, Major D. J.
Kindersley, Major G. M.
Todd, Capt. A. J.


Cranborne, Viscount
King, Commodore Rt. Hon. Henry D.
Tryon, Rt. Hon. George Clement


Crichton-Stuart, Lord C.
Lane Fox, Col. Rt. Hon. George R.
Turton, Robert Hugh


Croft, Brigadier-General Sir H.
Leighton, Major B. E. P.
Wallace, Capt. D. E. (Hornsey)


Crookshank, Cpt. H. (Lindsey, Gainsbro)
Locker-Lampson, Rt. Hon. Godfrey
Ward, Lieut.-Col. Sir A. Lambert


Culverwell, C. T. (Bristol, West)
Long, Major Eric
Wardlaw-Milne, J. S.


Cunliffe-Lister, Rt. Hon. Sir Philip
MacRobert, Rt. Hon. Alexander M.
Warrender, Sir Victor


Dalkeith, Earl of
Makins, Brigadier-General E.
Wayland, Sir William A.


Dalrymple-White, Lt.-Col. Sir Godfrey
Margesson, Captain H. D.
Wells, Sydney R.


Davies, Dr. Vernon
Marjoribanks, E. C.
Williams, Charles (Devon, Torquay)


Davison, Sir W. H. (Kensington, S.)
Mitchell, Sir W. Lane (Streatham)
Windsor-Clive, Lieut.-Colonel George


Duckworth, G. A. V.
Mond, Hon. Henry
Wolmer, Rt. Hon. Viscount


Eden, Captain Anthony
Monsell, Eyres, Com. Rt. Hon. Sir B.
Womersley, W. J.


Edmondson, Major A. J.
Moore, Lieut.-Colonel T. C. R. (Ayr)
Wood, Rt. Hon. Sir Kingsley


Elliot, Major Walter E.
Nicholson, O. (Westminster)
Worthington, Evans, Rt. Hon. Sir L.


England, Colonel A.
Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)



Erskine, Lord (Somerset, Weston-s-M.)
O'Connor, T. J.
TELLERS FOR THE NOES.—


Everard, W. Lindsay
O'Neill, Sir H.
Sir George Penny and Major the


Falle, Sir Bertram G.
Ormsby-Gore, Rt. Hon. William
Marquess of Titchfield.


Ferguson, Sir John
Peake, Capt. Osbert

Question put accordingly, "That the words proposed to be left out stand part of the Clause."

The Committee divided Ayes, 273; Noes, 156.

Division No. 328.]
AYES.
[5.8 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Attlee, Clement Richard
Bennett, Capt. Sir E. N. (Cardiff C.)


Adamson, W. M. (Staff., Cannock)
Ayles, Walter
Benson, G.


Addison, Rt. Hon. Dr. Christopher
Baker, John (Wolverhampton, Bilston)
Bevan, Aneurin (Ebbw Vale)


Aitchison, Rt. Hon. Craigie M.
Baldwin, Oliver (Dudley)
Bowen, J. W.


Alexander, Rt. Hon. A. V. (Hillsbro')
Barnes, Alfred John
Broad, Francis Alfred


Alpass, J. H.
Batey, Joseph
Bromfield, William


Ammon, Charles George
Beckett, John (Camberwell, Peckham)
Bromley, J.


Arnott, John
Bellamy, Albert
Brooke, W.


Aske, Sir Robert
Benn, Rt. Hon. Wedgwood
Brothers, M.


Brown, C. W. E. (Notts, Mansfield)
Jones, Rt. Hon. Leif (Camborne)
Riley, Ben (Dewsbury)


Brown, Ernest (Leith)
Jones, Morgan (Caerphilly)
Riley, F. F. (Stockton-on-Tees)


Brown, Rt. Hon. J. (South Ayrshire)
Jones, T. I. Mardy (Pontypridd)
Ritson, J.


Brown, W. J. (Wolverhampton, West)
Jowett, Rt. Hon. F. W.
Romeril, H. G.


Buchanan, G.
Jowitt, Rt. Hon. Sir W. A.
Rosbotham, D. S. T.


Buxton, C. R. (Yorks. W. R. Elland)
Kennedy, Thomas
Rowson, Guy


Caine, Derwent Hall-
Kirkwood, D.
Runciman, Rt. Hon. Walter


Cameron, A. G.
Knight, Holford
Russell, Richard John (Eddisbury)


Cape, Thomas
Lambert, Rt. Hon. George (S. Molton)
Salter, Dr. Alfred


Carter, W. (St. Pancras, S. W.)
Lang, Gordon
Samuel, Rt. Hon. Sir H. (Darwen)


Charieton, H. C.
Lansbury, Rt. Hon. George
Samuel, H. W. (Swansea, West)


Chater, Daniel
Lathan, G.
Sanders, W. S.


Church, Major A. G.
Law, Albert (Bolton)
Sandham, E.


Clarke, J. S.
Law, A. (Rosendale)
Sawyer, G. F.


Cluse, W. S.
Lawrence, Susan
Scott, James


Cocks, Frederick Seymour
Lawson, John James
Scrymgeour, E.


Compton, Joseph
Lawther, W. (Barnard Castle)
Scurr, John


Cove, William G.
Leach, W.
Sexton, James


Daggar, George
Lee, Frank (Derby, N. E.)
Shaw, Rt. Hon. Thomas (Preston)


Dallas, George
Lee, Jennie (Lanark, Northern)
Sherwood, G. H.


Dalton, Hugh
Lees, J.
Shield, George William


Davies, E. C. (Montgomery)
Lewis, T. (Southampton)
Shillaker, J. F.


Davies, Rhys John (Westhoughton)
Lloyd, C. Ellis
Shinwell, E.


Day, Harry
Logan, David Gilbert
Short, Alfred (Wednesbury)


Denman, Hon. R. D.
Longbottom, A. W.
Simon, E. D. (Manch'ter, Withington)


Dickson, T.
Longden, F.
Sinkinson, George


Dudgeon, Major C. R.
Lovat-Fraser, J. A.
Sitch, Charles H.


Dukes, C.
Lowth, Thomas
Smith, Alfred (Sunderland)


Duncan, Charles
Lunn, William
Smith, Ben (Bermondsey, Rotherhithe)


Ede, James Chuter
Macdonald, Gordon (Ince)
Smith, Frank (Nuneaton)


Edmunds, J. E.
MacDonald, Rt. Hon. J. R. (Seaham)
Smith, H. B. Lees- (Keighley)


Egan, W. H.
MacDonald, Malcolm (Bassetlaw)
Smith, Rennie (Penistone)


Elmley, Viscount
McElwee, A.
Smith, Tom (Pontefract)


Foot, Isaac
McEntee, V. L.
Snell, Harry


Forgan, Dr. Robert
McKinlay, A.
Snowden, Rt. Hon. Philip


Freeman, Peter
MacLaren, Andrew
Snowden, Thomas (Accrington)


Gardner, B. W. (West Ham, Upton)
MacNeill-Weir, L.
Sorensen, R.


Gardner, J. P. (Hammersmith, N.)
McShane, John James
Stamford, Thomas W.


Gibbins, Joseph
Malone, C. L'Estranga (N'thampton)
Stephen, Campbell


Gibson, H. M. (Lancs. Mossley)
Mander, Geoffrey le M.
Stewart, J. (St. Rollox)


Gill, T. H.
Mansfield, W.
Strachey, E. J. St. Loe


Gillett, George M.
March, S.
Strauss, G. R.


Gossling, A. G.
Marcus, M.
Sutton, J. E.


Gould, F.
Markham, S. F.
Taylor, R. A. (Lincoln)


Graham, D. M. (Lanark, Hamilton)
Marley, J.
Taylor, W. B. (Norfolk, S. W.)


Graham, Rt. Hon. Wm. (Edin., Cent.)
Mathers, George
Thomas, Rt. Hon. J. H. (Derby)


Gray, Milner
Matters, L. W.
Thorne, W. (West Ham, Plaistow)


Grenfell, D. R. (Glamorgan)
Maxton, James
Thurtle, Ernest


Griffith, F. Kingsley (Middlesbro' W.)
Melville, Sir James
Tinker, John Joseph


Griffiths, T. (Monmouth, Pontypool)
Messer, Fred
Toole, Joseph


Groves, Thomas E.
Middleton, G.
Tout, W. J.


Grundy, Thomas W.
Millar, J. D.
Townend, A. E.


Hall, F. (York, W. R., Normanton)
Mills, J. E.
Trevelyan, Rt. Hon. Sir Charles


Hall, G. H. (Merthyr Tydvil)
Montague, Frederick
Turner, B.


Hall, Capt. W. P. (Portsmouth, C.)
Morgan, Dr. H. B.
Vaughan, D. J.


Hamilton, Mary Agnes (Blackburn)
Morley, Ralph
Viant, S. P.


Hamilton, Sir R. (Orkney & Zetland)
Morris, Rhys Hopkins
Walkden, A. G.


Harbord, A.
Morris-Jones, Dr. J. H. (Denbigh)
Walker, J.


Hardie, George D.
Morrison, Herbert (Hackney, South)
Wallace, H. W.


Hartshorn, Rt. Hon. Vernon
Morrison, Robert C. (Tottenham, N.)
Wallhead, Richard C.


Hastings, Dr. Somerville
Mort, D. L.
Watkins, F. C.


Haycock, A. W.
Moses, J. J. H.
Watson, W. M. (Dunfermline)


Hayday, Arthur
Muff, G.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Henderson, Right Hon. A. (Burnley)
Muggeridge, H. T.
Welsh, James (Paisley)


Henderson, Arthur, Junr. (Cardiff, S.)
Nathan, Major H. L.
West, F. R.


Henderson, Thomas (Glasgow)
Naylor, T. E.
Westwood, Joseph


Henderson, W. W. (Middx., Enfield)
Newman, Sir R. H. S. D. L. (Exeter)
White, H. G.


Herriotts, J.
Noel Baker, P. J.
Whiteley, Wilfrid (Birm., Ladywood)


Hirst, G. H. (York, W. R., Wentworth)
Oliver, George Harold (Ilkeston)
Whiteley, William (Blaydon)


Hirst, W. (Bradford, South)
Palin, John Henry
Wilkinson, Ellen C.


Hoffman, P. C.
Parkinson, John Allen (Wigan)
Williams, David (Swansea, East)


Holfins, A.
Perry, S. F.
Williams Dr. J. H. (Llanelly)


Hopkin, Daniel
Peters, Dr. Sidney John
Williams, T. (York, Don Valley)


Horrabin, J. F.
Pethick-Lawrence, F. W.
Wilson, C. H. (Sheffield, Attercliffe)


Hudson, James H. (Huddersfield)
Picton-Turbervill, Edith
Wilson, J. (Oldham)


Hunter, Dr. Joseph
Pole, Major D. G.
Wilson, R. J. (Jarrow)


Hutchison, Maj.-Gen. Sir R.
Potts, John S.
Winterton, G. E. (Leicester, Loughb'gh)


Isaacs, George
Price, M. P.
Wise, E. F.


Jenkins, W (Glamorgan, Neath)
Pybus, Percy John
Young, R. S. (Islington, North)


John, William (Rhondda, West)
Quibell, D. J. K.



Jones, F. Llewellyn- (Flint)
Ramsay, T. B. Wilson
TELLERS FOR THE AYES.—


Jones, Henry Haydn (Merioneth)
Richards, R.
Mr. Charles Edwards and Mr.


Jones, J. J. (West Ham, Silvertown)
Richardson, R. (Houghton-le-Spring)
Paling.




NOES.


Acland-Troyte, Lieut.-Colonel
Fielden, E. B.
O'Neill, Sir H.


Albery, Irving James
Fison, F. G. Clavering
Ormsby-Gore, Rt. Hon. William


Amery, Rt. Hon. Leopold C. M. S.
Forestler-Walker, Sir L.
Peake, Capt. Osbert


Astor, Viscountess
Fremantle, Lieut.-Colonel Francis E.
Penny, Sir George


Baillie-Hamilton, Hon. Charles W.
Gault, Lieut.-Col. Andrew Hamilton
Percy, Lord Eustace (Hastings)


Beaumont, M. W.
Gibson, C. G. (Pudsey & Otley)
Peto, Sir Basil E. (Devon, Barnstaple)


Berry, Sir George
Gilmour, Lt.-Col. Rt. Hon. Sir John
Pilditch, Sir Philip


Betterton, Sir Henry B.
Glyn, Major R. G. C.
Pownall, Sir Assheton


Bird, Ernest Roy
Gower, Sir Robert
Rawson, Sir Cooper


Bourne, Captain Robert Croft
Graham, Fergus (Cumberland, N.)
Remer, John R.


Bowater, Col. Sir T. Vansittart
Grattan-Doyle, Sir N.
Rentoul, Sir Gervais S.


Bowyer, Captain Sir George E. W.
Grenfell, Edward C. (City of London)
Reynolds, Col. Sir James


Boyce, H. L.
Gretton, Colonel Rt. Hon. John
Richardson, Sir P. W. (Sur'y, Ch'ts'y)


Bracken, B.
Gritten, W. G. Howard
Roberts, Sir Samuel (Ecclesall)


Briscoe, Richard George
Gunston, Captain D. W.
Rodd, Rt. Hon. Sir James Rennell


Brown, Col. D. C. (N'th'l'd., Hexham)
Hall, Lieut.-Col. Sir F. (Dulwich)
Russell, Alexander West (Tynemouth)


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Hamilton, Sir George (Ilford)
Salmon, Major I.


Buchan, John
Hannon, Patrick Joseph Henry
Samuel, A. M. (Surrey, Farnham)


Burton, Colonel H. W.
Hartington, Marquess of
Sandeman, Sir N. Stewart


Butler, R. A.
Harvey, Major S. E. (Devon, Totnes)
Shepperson, Sir Ernest Whittome


Cadogan, Major Hon. Edward
Haslam, Henry C.
Simms, Major-General J.


Cautley, Sir Henry S.
Henderson, Capt. R. R. (Oxf'd, Henley)
Sinclair, Col. T. (Queen's U., Belfast)


Cayzer, Sir C. (Chester, City)
Heneage, Lieut.-Colonel Arthur P.
Smith, Louis W. (Sheffield, Hallam)


Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.)
Hennessy, Major Sir G. R. J.
Smith-Carington, Neville W.


Cazalet, Captain Victor A.
Herbert, Sir Dennis (Hertford)
Smithers, Waldron


Chapman, Sir S.
Hills, Major Rt. Hon. John Waller
Somerville, A. A. (Windsor)


Christie, J. A.
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Southby, Commander A. R. J.


Churchill, Rt. Hon. Winston Spencer
Horne, Rt. Hon. Sir Robert S.
Spender-Clay, Colonel H.


Colfox, Major William Philip
Hudson, Capt. A. U. M. (Hackney, N.)
Stanley, Lord (Fylde)


Colman, N. C. D.
Hurd, Percy A.
Stanley, Maj. Hon. O. (W'morland)


Colville, Major D. J.
Hurst, Sir Gerald B.
Steel-Maitland, Rt. Hon. Sir Arthur


Courthope, Colonel Sir G. L.
Iveagh, Countess of
Stewart, W. J. (Belfast, South)


Cowan, D. M.
Kedward, R. M. (Kent, Ashford)
Sueter, Rear-Admiral M. F.


Cranborne, Viscount
Kindersley, Major G. M.
Thomas, Major L. B. (King's Norton)


Crichton-Stuart, Lord C.
King, Commodore Rt. Hon. Henry D.
Thomson, Sir F.


Croft, Brigadier General Sir H.
Lamb, Sir J. Q.
Tinne, J. A.


Crookshank, Cpt. H. (Lindsey, Gainsbro)
Lane Fox, Col. Rt. Hon. George R.
Titchfield, Major the Marquess of


Culverwell, C. T. (Bristol, West)
Leighton, Major B. E. P.
Todd, Capt. A. J.


Cunliffe-Lister, Rt. Hon. Sir Philip
Locker-Lampson, Rt. Hon. Godfrey
Tryon, Rt. Hon. George Clement


Dalkeith, Earl of
Long, Major Eric
Turton, Robert Hugh


Dalrymple-White, Lt.-Cot. Sir Godfrey
Macpherson, Rt. Hon. James I.
Ward, Lieut.-Col. Sir A. Lambert


Davies, Dr. Vernon
MacRobert, Rt. Hon. Alexander M.
Wardlaw-Milne, J. S.


Davison, Sir W. H. (Kensington, S.)
Makins, Brigadier-General E.
Wayland, Sir William A.


Duckworth, G. A. V.
Margesson, Captain H. D.
Wells, Sydney R.


Eden, Captain Anthony
Marjoribanks, E. C.
Williams, Charles (Devon, Torquay)


Edmondson, Major A. J.
Mitchell, Sir W. Lane (Streatham)
Windsor-Clive, Lieut.-Colonel George


Elliot, Major Walter E.
Mond, Hon. Henry
Wolmer, Rt. Hon. Viscount


England, Colonel A.
Monsell, Eyres. Com. Rt. Hon. Sir B.
Womersley, W. J.


Erskine, Lord (Somerset, Weston-s.-M.)
Moore, Lieut.-Colonel T. C. R. (Ayr)
Wood, Rt. Hon. Sir Kingsley


Everard, W. Lindsay
Nicholson, O. (Westminster)
Worthington-Evans, Rt. Hon. Sir L.


Falle, Sir Bertram G.
Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)



Ferguson, Sir John
O'Connor, T. J.
TELLERS FOR THE NOES.—


Fermoy, Lord
Oliver, P. M. (Man., Blackley)
Captain Wallace and Sir Victor




Warrender.

The CHAIRMAN: The next Amendment which I select is in the name of the hon. Member for East Lewisham (Sir A. Pownall).

Sir L. WORTHINGTON-EVANS: Was there not a manuscript Amendment?

The CHAIRMAN: I have selected the Amendment in the name of the hon. Member for East Lewisham.

Sir L. WORTHINGTON-EVANS: May I ask, with regard to the manuscript Amendment, whether it was not called because it was ruled out of order, or because it was not selected?

The CHAIRMAN: It was not selected.

Sir ASSHETON POWNALL: I beg to move, in page 4, line 18, to leave out the
word "July," and to insert instead thereof the word "January."
The reason for this Amendment is to be found in the fact that last year, when two separate Finance Bills were to be brought forward, the second one was dropped owing, as some of us think, to the regrettable episode which took place in the latter part of May when there was a change in the constitution of this Chamber. These particular provisions would have been put into the Finance Bill No. 2 of last year had there not been a change of Government. They are shown clearly in page 4 of the Finance Bill and affect motor bicycles which only have to pay a higher rate of duty if they exceed 224 lbs. instead of exceeding 200 lbs. They also make a
concession in regard to motor vehicles between two tons and 2½ tons in weight, unladen. It is most unfair, if the new Government thinks, as did the old Government, that these particular concessions should be given, that unfortunate individuals should be penalised, as they will be penalised, for six months merely owing to the change of Government. The Minister of Transport made most eloquent appeals to this side of the Committee regarding the last Amendment, because, he said, it would have been the intention of the late Government, had they remained in office. If that argument applied to the last Amendment, it applies equally to this Amendment. If the concessions were to have been given in regard to vehicles of these particular weights a year ago it is very unfair now to deny the concessions until the 1st July, when they might just as well take effect as from the 1st January. It might be said that there would be difficulty in regard to those who have already paid, but Sub-section (3) provides that anyone who has already taken out a licence is entitled to have a proportion of his money back. Taxation bears very hardly upon these two particular classes. Motor cyclists are not the wealthy class of the community, and there is a saving of 30s. to those who have motor bicycles between 200 and 224 pounds in weight, unladen. It is only fair that this concession should be made. I understand that relatively the cost would be very small indeed, and that there is not much administrative difficulty in regard to it.

Mr. HERBERT MORRISON: It should be appreciated by the Committee that the agitation, so to speak, which led to this concession was not so much an effort by the licence-holders and users of vehicles but a very strong effort made by the manufacturers of these vehicles for certain trade reasons which appeared to the last Government and to this Government to have force behind it. Therefore, I think the Committee would be unwise to consider this primarily as a concession to the licence-holder. It gives certain advantages to the licence-holder and it is a concession to the licence-holder, but the Committee would be wrong to consider it otherwise than as primarily a concession to meet certain difficulties placed before
the Government by the manufacturers of this class of vehicle. The Amendment, as the hon. Member has said, would make the concession in respect of motor bicycles, and of goods vehicles operate from the 1st January, 1930. I do not know that it is relevant to say that, as the last Government intended it to operate from the 1st January, therefore this Government, to be logical, should do the same. The actual date which the late Government intended if the Finance (No. 2) Bill had passed was the 1st January, 1930. The date which this Government have adopted is the date given in the Bill, and logically there is no difference and no inconsistency between the two. It is a difference of date, entirely accounted for by the fact that the Bill is being dealt with at a different period.
If the Amendment were incorporated, a large number of refunds would be payable in respect of ordinary licences taken out in the first two quarters of the year. The sums involved, I agree, would be relatively small, but the extra work falling upon the local authorities which we must all consider in this very big and administrative task would be considerable. There would, no doubt, be complications by administrative difficulties arising from the fact that licences might have expired and in many cases might have been destroyed, and there might have been considerable changes in the ownership of vehicles. That is a material point as far as administration is concerned. The cost would not be great. I am advised that it would be something in the region of £35,000. I do not resist the Amendment primarily on financial grounds, although £35,000 is a sum at which no Chancellor of the Exchequer could sneeze in these hard times.

Mr. CHURCHILL: I think that it might well simplify and possibly abridge our proceedings if the hon. Gentleman told us exactly, to the best of his belief, what were the financial issues involved in this Amendment, and not only in the Amendment but in the Clause. This Amendment, obviously, is a modification of the Clause. Is it true that the Clause itself involves only a very small sum, and what is that sum? What is the sum which the Amendment takes away from the yield of the Clause? If we could have that information, we should know what are the dimensions of the problem with which we are dealing.

Mr. MORRISON: The additional cost would be £35,000. The real point about this matter is that it is a concession to manufacturers in reference to things now regarded as necessary, like electrical equipment, and leg protectors on vehicles. I think that the result of the change we propose will be to enable manufacturers to add this useful equipment without moving the vehicle into a more highly taxed category. Therefore, I do not think that there is very much of the financial aspect about it at all. It is a concession to manufacturers in order to enable them to add certain desirable things to the vehicle. It is difficult, if not impossible, to estimate the cost of the whole of the concessions in Clause 6, but they will amount to about £80,000 or £100,000 in a full financial year. I am sorry that I cannot for reasons which the right hon. Gentleman will appreciate separate this particular item from the rest.
I will come back to the main point which the Committee ought to consider. We have to consider this particular concession, not as a concession so much to the rider or the licence-holder, as a concession to the manufacturer to enable the manufacturer to add certain pieces of equipment which are useful in themselves without thereby automatically bringing the vehicle into the category of the higher taxed vehicle. For those reasons, it would not be wise to adopt the Amendment, especially in view of the very considerable administrative difficulties which would be involved not only to the Ministry of Transport but to all counties and county boroughs who collect the Road Fund licences on behalf of the Government.

Mr. ALBERY: The Minister, in speaking against this Amendment, has given the very best argument possible in favour of it. He has said that the primary object is a concession, not to benefit the riders of motor bicycles but manufacturers. We should all of us perhaps on all sides of the House, if we could, like to confer a benefit on that large section of the population who ride motor bicycles, but, whatever our feelings are on that subject, they are very mild compared with the feelings which we ought to have at the present moment regarding manufacturers and trade. The Minister has explained that, in order to bring motor
cycles up-to-date, the manufacturers consider that this concession is necessary. When I think of the condition of trade generally in the country, I can conceive of no better argument which the Minister or anyone else can possibly produce for accepting the concession than the one which he has just mentioned. It is desirable that our motor cycle manufacturers should at the earliest possible moment be enabled to produce the most efficient and up-to-date machines for sale in these markets and in other markets. Although the duty may only govern the machines in these markets, we have a large export trade, and no doubt under the present system of mass production it will also affect machines made for export. We always hear, when any Amendment is moved, that there are administrative difficulties. There probably are some difficulties, but they are not insurmountable. Although one can get any overpayment of taxation reimbursed it is never an easy matter, and in the present case a great many of these payments will never be reclaimed. The amount which will be lost to the Treasury therefore will be very much less than that stated by the Minister of Transport.

Mr. REMER: I did not quite understand the Minister of Transport's reply to this Amendment. He based his estimate as to the amount which would have to be repaid on the fact that quarterly licences would not become payable at the end of the year. A very considerable number of licences are taken out for a year and fall due on the 31st December. The amount to be repaid would be infinitesimal. The trade should know beforehand what the position is going to be in order that they may be able to prepare for any alteration. They should have the fullest information six months ahead as to what is exactly in front of them. I think the 1st of January is a much better date to put in the Bill than the 1st of July. It would he more convenient to everyone, better for the trade and better for all people connected with the industry. I hope the Minister will explain how he arrives at this sum of £35,000. Obviously he must have made a mistake in his original statement. I presume that it will be open to me to move an Amendment that the date should be the 1st January, 1931. If I vote in favour of the word "January"
going into the Bill I presume it will be in order for me to hand in a manuscript Amendment—

The CHAIRMAN: This is going much too far. We must keep to the Amendment before the Committee.

Mr. REMER: I may have, perhaps, misunderstood the Amendment, but I take the view that the date should be the 1st January, 1931, and I hope I shall he in order in voting in favour of January instead of July.

The CHAIRMAN: The Question before the Committee is that the word "July" stand part of the Clause.

Mr. THURTLE: May not the hon. Member for Macclesfield (Mr. Remer) be ruled out of order for incoherence?

Mr. CHURCHILL: May I ask whether that kind of discourteous interruption is likely to facilitate the progress of our debates?

The CHAIRMAN: I do not think it is necessary; and I do not think that any reply is necessary.

Mr. REMER: I am much obliged to you, Mr. Chairman, for your protection on this occasion. It is my view that the word "January" should be inserted in the Clause in place of the word "July," but instead of being post-dated I want to ante-date it; but I must support the Amendment now and reserve to myself the right to hand in a manuscript Amendment to make my meaning clear.

Lieut.-Colonel Sir FREDERICK HALL: I think the Minister of Transport should accept this small Amendment. It is only a question of £35,000. In Sub-section 3 difficulties will arise in regard to rebates on licences that have already been taken out. The Minister of Transport says that the manufacturers have been pressing for this concession. If that is the case, surely in these times of difficult trade any assistance or help which can be given should be given.

Mr. HERBERT MORRISON: The manufacturer has not the slightest interest in this Amendment, one way or the other. Vehicles on the road on the 1st July are already sold, and, therefore, he has no interest in them. We look after the manufacturer on the 1st July. He is all right; his problem will be met. The
only person who will get an advantage under the Amendment will be the licence holder.

Sir F. HALL: If money has been taken from the licence holder which should not have been extracted it will be something fresh for the Government to say that they will rectify a wrong which has been done and give a rebate. In view of what the Minister of Transport has said I cannot press the matter in regard to the manufacturer, but I still have my own opinion on that subject. I still think that some benefit would accrue to the manufacturer under this Amendment. The late Government, had it remained in power, intended this to come in on 1st January, and it is only fair and right and equitable to ask the present Government to adopt the same line. It was understood they would do so. It is such a small amount that surely the hon. Gentleman might accept it.

Mr. CHURCHILL: I agree with what the hon. and gallant Member for Dulwich (Sir F. Hall) has said. This is really a case where a minor nemesis has overtaken the Government. The original proposal figured in the Budget of last year. Owing to our desire to take the sense of the country on the general political issues we divided the Budget into two portions; the main necessary and operative part and certain provisions of a non-controversial but desirable character which were left over so that they did not interfere with the convenience of the country when their electoral decision was recorded. It was assumed that as soon as the new Government was formed that these comparatively unimportant and non-controversial but nevertheless desirable provisions would be passed through the House in a second and subsidiary Finance Bill. They made their arrangements and adjusted their outlook to the new conditions. It was the Chancellor of the Exchequer who brushed all this aside. He wanted to slight the work of his predecessor. That was the mood in which he came to his office; to show how well he could do it; and he brushed it aside with an imperious gesture of contempt expressed by a brand new broom.
Now a year has passed and the Government has to come forward and stand in a white sheet for their neglect.
The Minister of Transport has to say that this is one of the proposals wanted by the Chancellor of the Exchequer last year and that it is a just, legitimate, necessary and desirable feature in our legislation; that it would have been right to do it last year. If it was right to do it last year it is all the more right to do it now. The Government have extended this anomaly, this unfair treatment, for the whole year and now, when we have this enormously complicated Finance Bill, with its almost limitless succession of Clauses and Amendments, they take up the best part of two hours of the time of the Committee in presenting an Amendment to the existing law which ought to have been done last year and which might have been done by general consent last year. In a moment of great embarrassment of Parliamentary business the Government presses it upon the Committee. The Government are entirely and absolutely to blame. The very mood and temper in which they have approached their duties is the cause of their misfortune at the moment. We could have got this without the least trouble.
What is it that we ask in this Amendment? All we ask is that if the Government a year later, having seen the error of their ways, their education advanced by a year's contact with responsibility—or the best approach they can make to responsibility—when all the claptrap which they talked on public platforms has been worn off, come forward and indicate their desire to pass what we proposed, and what we should have passed into law last year, we say, "All right, we accept the Amendment; but if you consider accepting our proposal, you should reinstate the proposition in the exact form in which we originally proposed it." We proposed that it should date from January. We are willing to agree with the Government that it should be done at once, but we say that the Government should accept it in the form in which it was originally proposed. One cannot tell what expectations were raised or what arrangements were made. It is important that the legislation of this country should proceed on a definite and solid basis, and that what has been formally proposed by responsible Ministers should be carried into law.
The second Finance Bill should never have been rejected and treated in that unceremonious manner, and if my hon. and gallant Friend chooses to go to a Division, I shall give him my vote in order to reinstate this law in the form in which it was originally proposed.

Major COLFOX: It seems to me that the guiding principle on this Amendment must be which date, January or July, would cause the least administrative dislocation and difficulty. In default of any definite pronouncement to the contrary from the Minister, I think that the date of January would produce the least administrative difficulties, for the simple reason that most licences are taken out for a full year from 1st January to 31st December. Very much less difficulty would be incurred by the local authorities which have to administer this Clause if we were to insert the date of January. There is another reason which leads me to support the Amendment. It gives to the Government a chance to repair some of the disastrous effects that have befallen the country as a result of the General Election of last year. It allows the pledge which was given by the last Government to become operative—a pledge on which many people had built their hopes. I ask the Minister to tell us which of the two dates, January or July, will, in his opinion, impose the greater burden and difficulty on local authorities. I shall be guided to a very large extent by his reply.

Mr. C. WILLIAMS: I would like to know whether the Minister's first speech or his second was accurate, for the two speeches contradicted each other. In the first he led the House to believe that it was the manufacturers who would benefit by this Clause. In his second speech he said it was the licence holders who would benefit. A possible explanation of the contradiction is that in his first speech the Minister was meandering and out of order.

The CHAIRMAN: The hon. Gentleman must kindly leave the matter of order to me.

Mr. WILLIAMS: Certainly. I was merely trying to find out which of the Minister's two speeches was the correct one. I conclude that his first speech was accurate and that the manufacturers will benefit. I notice that the Minister was
careful to use the term "manufacturers." He omitted to say what type of manufacturers they were. Is it that he has been approached by certain foreign or British manufacturers in respect of the Amendment? I should like to know. Is he being forced by some external ring to amend the Bill, or is he following out what I would call the half-Budget which was dropped at the latter end of last year? If there was pressure we are entitled to know whence the pressure came. Or is the explanation that Ministers are not as foolish as they were last year, and that they realise that their predecessors were wise. The introduction of

this Clause does show a slight increase in sanity on the part of Ministers. Why cannot they go a little further and accept the Amendment? Some of those who are affected may not be alive by July. Purely from the point of humanity I ask the Minister, therefore, to grant this concession. It would give many of us immense satisfaction. The hon. Gentleman has not made any concession so far to-day.

Question put, "That the word 'July' stand part of the Clause."

The Committee divided: Ayes, 275; Noes, 158.

Division No. 329.]
AYES.
[5.55 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Ede, James Chuter
Jones, Rt. Hon. Leif (Camborne)


Adamson, W. M. (Staff,, Cannock)
Edmunds, J. E.
Jones, Morgan (Caerphilly)


Addison, Rt. Hon. Dr. Christopher
Edwards, C. (Monmouth, Bedwellty)
Jones, T. I. Mardy (Pontypridd)


Aitchison, Rt. Hon. Craigie M.
Edwards, E. (Morpeth)
Jowett, Rt. Hon. F. W.


Alexander, Rt. Hon. A. V. (Hillsbro')
Egan, W. H.
Jowitt, Rt. Hon. Sir W. A.


Alpass, J. H.
Elmley, Viscount
Kedward, R. M. (Kent, Ashford)


Ammon, Charles George
England, Colonel A.
Kennedy, Thomas


Arnott, John
Evans, Capt. Ernest (Welsh Univer.)
Kinley, J.


Aske, Sir Robert
Foot, Isaac
Kirkwood, D.


Attlee, Clement Richard
Freeman, Peter
Knight, Holford


Ayles, Walter
Gardner, B. W. (West Ham, Upton)
Lambert, Rt. Hon. George (S. Molton)


Baker, John (Wolverhampton, Bilston)
Gardner, J. P. (Hammersmith, N.)
Lang, Gordon


Baldwin, Oliver (Dudley)
George, Rt. Hon. D. Lloyd (Car'vn)
Lansbury, Rt. Hon. George


Barnes, Alfred John
George, Megan Lloyd (Anglesea)
Lathan, G.


Batey, Joseph
Gibbins, Joseph
Law, Albert (Bolton)


Beckett, John (Camberwell, Peckham)
Gibson, H. M. (Lancs. Mossley)
Law, A. (Rossendale)


Bellamy, Albert
Gill, T. H.
Lawrence, Susan


Benn, Rt. Hon. Wedgwood
Gillett, George M.
Lawson, John James


Bennett, Capt. Sir E. N. (Cardiff C.)
Gossling, A. G.
Lawther, W. (Barnard Castle)


Benson, G.
Gould, F.
Leach, W.


Bentham, Dr. Ethel
Graham, D. M. (Lanark, Hamilton)
Lee, Frank (Derby, N. E.)


Bevan, Aneurin (Ebbw Vale)
Graham, Rt. Hon. Wm. (Edin., Cent.)
Lee, Jennie (Lanark, Northern)


Bowen, J. W.
Gray, Milner
Lees, J.


Broad, Francis Alfred
Grenfell, D. R. (Glamorgan)
Lewis, T. (Southampton)


Bromfield, William
Griffith, F. Kingsley (Middlesbro' W.)
Lloyd, C. Ellis


Bromley, J.
Griffiths, T. (Monmouth, Pontypool)
Logan, David Gilbert


Brooke, W.
Groves, Thomas E.
Longbottom, A. W.


Brothers, M.
Grundy, Thomas W.
Longden, F.


Brown, C. W. E. (Notts, Mansfield)
Hall, F. (York, W. R., Normanton)
Lovat-Fraser, J. A.


Brown, Ernest (Leith)
Hall, G. H. Merthyr Tydvil)
Lowth, Thomas


Brown, Rt. Hon. J. (South Ayrshire)
Hall, Capt. W. P. (Portsmouth, C.)
Lunn, William


Brown, W. J. (Wolverhampton, West)
Hamilton, Mary Agnes (Blackburn)
Macdonald, Gordon (Ince)


Buchanan, G.
Hamilton, Sir R. (Orkney & Zetland)
MacDonald, Rt. Hon. J. R. (Seaham)


Buxton, C. R. (Yorks. W. R. Elland)
Harbord, A.
MacDonald, Malcolm (Bassetlaw)


Cameron, A. G.
Hardie, George D.
McElwee, A.


Cape, Thomas
Hartshorn, Rt. Hon. Vernon
McEntee, V. L.


Carter, W. (St. Pancras, S. W.)
Hastings, Dr. Somerville
McKinlay, A.


Charieton, H. C.
Haycock, A. W.
MacNeill-Weir, L.


Chater, Daniel
Hayday, Arthur
McShane, John James


Church, Major A. G.
Henderson, Right Hon. A. (Burnley)
Malone, C. L'Estrange (N'thampton)


Clarke, J. S.
Henderson, Arthur, Junr. (Cardiff, S.)
Mander, Geoffrey le M.


Cluse, W. S.
Henderson, W. W. (Middx., Enfield)
Mansfield, W.


Clynes, Rt. Hon. John R.
Herriotts, J.
March, S.


Cocks, Frederick Seymour
Hirst, G. H. (York W. R. Wentworth)
Marcus, M.


Compton, Joseph
Hirst, W. (Bradford, South)
Markham, S. F.


Cove, William G.
Hoffman, P. C.
Marley, J.


Daggar, George
Hopkin, Daniel
Mathers, George


Dallas, George
Horrabin, J. F.
Matters, L. W.


Dalton, Hugh
Hudson, James H. (Huddersfield)
Maxton, James


Davies, E. C. (Montgomery)
Hunter, Dr. Joseph
Melville, Sir James


Davies, Rhys John (Westhoughton)
Hutchison, Maj.-Gen. Sir R.
Messer, Fred


Day, Harry
Isaacs, George
Middleton, G.


Denman, Hon. R. D.
Jenkins, W. (Glamorgan, Neath)
Millar, J. D.


Dickson, T.
John, William (Rhondda, West)
Mills, J. E.


Dudgeon, Major C. R.
Jones, F. Llewellyn- (Flint)
Milner, Major J.


Dukes, C.
Jones, Henry Haydn (Merioneth)
Montague, Frederick


Duncan, Charles
Jones, J. J. (West Ham, Silvertown)
Morgan Dr. H. B.


Morley, Ralph
Runciman, Rt. Hon. Walter
Sutton, J. E.


Morris, Rhys Hopkins
Russell, Richard John (Eddisbury)
Thorne, W. (West Ham, Plaistow)


Morris-Jones, Dr. J. H. (Denbigh)
Salter, Dr. Alfred
Thurtle, Ernest


Morrison, Herbert (Hackney, South)
Samuel, Rt. Hon. Sir H. (Darwen)
Tinker, John Joseph


Mort, D. L.
Samuel, H. W. (Swansea, West)
Toole, Joseph


Moses, J. J. H.
Sanders, W. S.
Tout, W. J.


Mosley, Lady C. (Stoke-on-Trent)
Sawyer, G. F.
Townend, A. E.


Muff, G.
Scott, James
Trevelyan, Rt. Hon. Sir Charles


Muggeridge, H. T.
Scrymgeour, E.
Turner, B.


Nathan, Major H. L.
Scurr, John
Vaughan, D. J.


Naylor, T. E.
Sexton, James
Viant, S. P.


Newman, Sir R. H. S. D. L. (Exeter)
Shaw, Rt. Hon. Thomas (Preston)
Walker, J.


Noel Baker, P. J.
Shepherd, Arthur Lewis
Wallace, H. W.


Oliver, George Harold (Ilkeston)
Sherwood, G. H.
Wallhead, Richard C.


Oliver, P. M. (Man., Blackley)
Shield, George William
Walters, Rt. Hon. Sir J. Tudor


Palin, John Henry
Shillaker, J. F.
Watkins, F. C.


Paling, Wilfrid
Shinwell, E.
Watson, W. M. (Dunfermline)


Parkinson, John Allen (Wigan)
Short, Alfred (Wednesbury)
Watts-Morgan, Lt.-Col. D. (Rhondda)


Perry, S. F.
Simon, E. D. (Manch'ter, Withington)
Welsh, James (Paisley)


Peters, Dr. Sidney John
Sinkinson, George
Westwood, Joseph


Pethick-Lawrence, F. W.
Sitch, Charles H.
White, H. G.


Picton-Turbervill, Edith
Smith, Alfred (Sunderland)
Whiteley, Wilfrid (Birm., Ladywood)


Pole, Major D. G.
Smith, Ben (Bermondsey, Rotherhithe)
Wilkinson, Ellen C.


Potts, John S.
Smith, Frank (Nuneaton)
Williams, David (Swansea, East)


Price, M. P.
Smith, H. B. Lees- (Keighley)
Williams, Dr. J. H. (Llanelly)


Quibell, D. J. K.
Smith, Rennie (Penistone)
Williams, T. (York, Don Valley)


Ramsay, T. B. Wilson
Smith, Tom (Pontefract)
Wilson, C. H. (Sheffield, Attercliffe)


Rathbone, Eleanor
Snell, Harry
Wilson, J. (Oldham)


Richards, R.
Snowden, Rt. Hon. Philip
Wilson, R. J. (Jarrow)


Richardson, R. (Houghton-le-Spring)
Snowden, Thomas (Accrington)
Winterton, G. E. (Leicester, Loughb'gh)


Riley, Ben (Dewsbury)
Sorensen, R.
Wood, Major McKenzie (Banff)


Riley, F. F. (Stockton-on-Tees)
Stamford, Thomas W.
Young, R. S. (Islington, North)


Ritson, J.
Stephen, Campbell



Romeril, H. G.
Stewart, J. (St. Rollox)
TELLERS FOR THE AYES.—


Rosbotham, D. S. T.
Strachey, E. J. St. Loe
Mr. T. Henderson and Mr. William


Rowson, Guy
Strauss, G. R.
Whiteley.


NOES.


Acland-Troyte, Lieut. Colonel
Davidson, Rt. Hon. J. (Hertford)
King, Commodore Rt. Hon. Henry D.


Albery, Irving James
Davies, Dr. Vernon
Lamb, Sir J. Q.


Astor, Viscountess
Davison, Sir W. H. (Kensington, S.)
Lane Fox, Col. Rt. Hon. George R.


Atkinson, C.
Duckworth, G. A. V.
Leighton, Major B. E. P.


Baillie-Hamilton, Hon. Charles W.
Eden, Captain Anthony
Locker-Lampson, Rt. Hon. Godfrey


Balniel, Lord
Edmondson, Major A. J.
Long, Major Eric


Beaumont, M. W.
Elliot, Major Walter E.
Macquisten, F. A.


Berry, Sir George
Erskine, Lord (Somerset, Weston-s.-M.)
MacRobert, Rt. Hon. Alexander M.


Betterton, Sir Henry B.
Everard, W. Lindsay
Makins, Brigadier-General E.


Birchall, Major Sir John Dearman
Falle, Sir Bertram G.
Margesson, Captain H. D.


Bird, Ernest Roy
Ferguson, Sir John
Marjoribanks, E. C.


Bourne, Captain Robert Croft
Fermoy, Lord
Mitchell, Sir W. Lane (Streatham)


Bowyer, Captain Sir George E. W.
Fielden, E. B.
Mond, Hon. Henry


Boyce, H. L.
Fison, F. G. Clavering
Monsell, Eyres, Com. Rt. Hon. Sir B.


Bracken, B.
Fremantle, Lieut.-Colonel Francis E.
Moore, Lieut.-Colonel T. C. R. (Ayr)


Brass, Captain Sir William
Gault, Lieut.-Col. Andrew Hamilton
Nicholson, O. (Westminster)


Briscoe, Richard George
Gibson, C. G. (Pudsey & Otley)
Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)


Brown, Col. D. C. (N'th'l'd., Hexham)
Gilmour, Lt.-Col. Rt. Hon. Sir John
O'Connor, T. J.


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Glyn, Major R. G. C.
O'Neill, Sir H.


Buchan, John
Gower, Sir Robert
Ormsby-Gore, Rt. Hon. William


Bullock, Captain Malcolm
Graham, Fergus (Cumberland, N.)
Peake, Capt. Osbert


Burton, Colonel H. W.
Grattan-Doyle, Sir N.
Percy, Lord Eustace (Hastings)


Butler, R. A.
Grenfell, Edward C. (City of London)
Peto, Sir Basil E. (Devon, Barnstaple)


Cadogan, Major Hon. Edward
Gretton, Colonel Rt. Hon. John
Pownall, Sir Assheton


Cautley, Sir Henry S.
Gritten, W. G. Howard
Ramsbotham, H.


Cayzer, Sir C. (Chester, City)
Gunston, Captain D. W.
Rawson, Sir Cooper


Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.)
Hacking, Rt. Hon. Douglas H.
Remer, John R.


Cazalet, Captain Victor A.
Hall, Lieut.-Col. Sir F. (Dulwich)
Reynolds, Col. Sir James


Chamberlain, Rt. Hn. Sir J. A. (Birm., W.)
Hamilton, Sir George (Ilford)
Richardson, Sir P. W. (Sur'y, Ch'ts'y)


Chapman, Sir S.
Hannon, Patrick Joseph Henry
Roberts, Sir Samuel (Ecclesall)


Christie, J. A.
Hartington, Marquess of
Russell, Alexander West (Tynemouth)


Churchill, Rt. Hon. Winston Spencer
Harvey, Major S. E. (Devon, Totnes)
Salmon, Major I.


Colfox, Major William Philip
Haslam, Henry C.
Samuel, A. M. (Surrey, Farnham)


Colman, N. C. D.
Henderson, Capt. R. R. (Oxf'd, Henley)
Sandeman, Sir N. Stewart


Colville, Major D. J.
Hennessy, Major Sir G. R. J.
Savery, S. S.


Courthope, Colonel Sir G. L.
Herbert, Sir Dennis (Hertford)
Shepperson, Sir Ernest Whittome


Cowan, D. M.
Hills, Major Rt. Hon. John Waller
Sinclair, Col. T. (Queen's U., Belfst)


Cranborne, Viscount
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Smith, Louis W. (Sheffield, Hallam)


Crichton-Stuart, Lord C.
Horne, Rt. Hon. Sir Robert S.
Smith-Carington, Neville W.


Croft, Brigadier-General Sir H.
Hudson, Capt. A. U. M. (Hackney, N.)
Smithers, Waldron


Crookshank, Cpt. H. (Lindsey, Gainsbro)
Hurd, Percy A.
Somerville, A. A. (Windsor)


Culverwell, C. T. (Bristol, West)
Hurst, Sir Gerald B.
Southby, Commander A. R. J.


Cunliffe-Lister, Rt. Hon. Sir Philip
Iveagh, Countess of
Spender-Clay, Colonel H.


Dalkeith, Earl of
Jones, Sir G. W. H. (Stoke New'gton)
Stanley, Lord (Fylde)


Dalrymple-White, Lt.-Col. Sir Godfrey
Kindersley, Major G. M.
Stanley, Maj. Hon. O. (W'morland)




Steel-Maitland, Rt. Hon. Sir Arthur
Tryon, Rt. Hon. George Clement
Windsor-Clive, Lieut.-Colonel George


Stewart, W. J. (Belfast, South)
Turton, Robert Hugh
Wolmer, Rt. Hon. Viscount


Stuart, Hon. J. (Moray and Nairn)
Ward, Lieut.-Col. Sir A. Lambert
Womersley, W. J.


Sueter, Rear-Admiral M. F.
Warrender, Sir Victor
Wood, Rt. Hon. Sir Kingsley


Thomas, Major L. B. (King's Norton)
Waterhouse, Captain Charles
Worthington-Evans, Rt. Hon. Sir L.


Thomson, Sir F.
Wayland, Sir William A.



Tinne, J. A.
Wells, Sydney R.
TELLERS FOR THE NOES—


Titchfield, Major the Marquess of
Williams, Charles (Devon, Torquay)
Sir George Penny and Captain


Train, J.
Wilson, G. H. A. (Cambridge U.)
Wallace.

Sir A. LAMBERT WARD: I beg to move, in page 4, line 31, to leave out "224" and insert"250."
This Amendment and the next Amendment on the Paper which is in similar terms, are consequential, the one upon the other and I may be allowed to deal with both at the same time. I feel rather conscience-stricken at the length of time which it took the Minister of Transport to explain the point raised in my earlier Amendment and I do not wish to take up too much of the Committee's time. It is a very fortunate thing that the integrity of His Majesty's Ministers and of our permanent officials stands as high as it does in this country because I am sure that in some other countries a Sub-section such as this would give rise to the suspicion that the Minister of Finance or the Minister of Transport had acquired a proprietary interest in bicycles which weighed more than 200 lbs. and that the Minister so interested was doing his best to promote the sale of that article. In this country, of course, such a thing is quite impossible but I wish to know whether the manufacturers are satisfied with the increase in weight which the Minister is giving them under this proposal.
On a previous Amendment the Minister said that this allowance was being made in order to allow of further equipment being put on the machine. I always understood that equipment such as lamps and things of that kind were not taken into account when weighing the machine and that it was the strict weight of the machine itself upon which taxation was based, and I always understood that the manufacturers required a considerably greater increase in weight than the Minister is giving them under this Subsection. I do not think that it is a question so much of equipment, as of being able to construct a stronger and, to adapt a naval expression, a more roadworthy machine, with the idea of selling machines not only at home, but in the Dominions and Colonies and elsewhere abroad. It is only 20 years ago since
the world was astonished at the manner in which motor transport could be driven over all kinds of roads. The world was astonished when the Ford car was driven over the veldts and through the desert and in all kinds of places, and where the Ford car could go, the motor bicycle can go—only to an even greater extent because it only requires a track of 1 foot or 18 inches wide and it can be driven in and out among rocks and almost anywhere. To do that sort of thing the machine must be well constructed and must have the necessary weight and strength to enable it to go over metalled tracks. That is the reason for the Amendment. I understand that many manufacturers are not satisfied with an increase of 24 lbs. but require more in order that they may construct machines which can be used both in this country and abroad.

Mr. HERBERT MORRISON: As far as I am advised the concession which we are making here is not related to any question of export trade or of the Dominion market. The manufacturers made representations to the effect that there had been improvements in the equipment of motor cycles and that there could be further improvements and that the 200 lb. limit was fettering the manufacturers in making the improvements which were desirable, or, alternatively, were imposing an unjust burden upon the users of bicycles by transferring those machines into the category of higher taxed vehicles. As an illustration of the equipment which is concerned and which involves a certain amount of extra weight I may mention electrical lighting apparatus, improved brakes, leg shields and other refinements which are regarded as essential for the modern motor bicycle. A discussion took place on the matter and the increase of 24 lbs. which is proposed in the Clause is, I am definitely advised, sufficient for the purposes of the manufacturers and traders who, have not asked for any greater increase. Therefore, I submit that this is a bona fide concession made for the purpose of meeting
a legitimate point raised by the manufacturers and, the manufacturers having acquiesced in the Government's proposal, I can see no case for the Amendment. The Amendment would involve a loss of revenue although no definite estimate can be made of the amount. In these circumstances the hon. and gallant Member may see his way to withdraw the Amendment.

Captain CAZALET: I think it would be difficult to find a Clause in which the evils of legislation by reference are more amply demonstrated than in this Clause, because all the way through we are referred to the Second Schedule of the Finance Act of 1920 when, in fact what is meant is the Third Schedule of the Finance Act of 1928. To the Minister no doubt the reason for this is very obvious, but I had to search through all the Finance Acts from 1920 onwards to discover what is really meant by the Clause. We are referred to a sub-paragraph (d) but such a paragraph does not exist in the 1920 Act at all, and I wish to know if this paragraph 1 which we are now discussing refers to the Second Schedule of the 1920 Act or if that Schedule has been amended since, and, if so, in which Finance Act has it been amended. There are other items mentioned in paragraph 1 of the Second Schedule to the Finance Act of 1920 including tricycles—

The DEPUTY-CHAIRMAN (Mr. Dunnico): I am not sure that a general question of that kind can be raised on this Amendment.

Captain CAZALET: May I, then, limit my remarks to asking the Minister if this Clause refers to the actual paragraph 1 of the 1Second Schedule to the Finance Act of 1920 or is there a later amending Finance Act or Schedule which I have not yet discovered?

Mr. C. WILLIAMS: I am sure that it was not through deliberate discourtesy that the Minister failed to answer the simple and civil question which I put to him on the last Amendment and which I propose to repeat on this Amendment. When he speaks of manufacturers, why does he avoid stating whether he refers to British or to foreign manufacturers? We understand that he has been approached by manufacturers in regard to
these matters, and we wish to know whether, in these proposals, he is acting in the interests of British manufacturers or in the interests of some outside body. If the manufacturers to whom he refers are British manufacturers, that strengthens the Minister's position enormously and he ought to inform the Committee on the point in order to save further time and trouble. I regret the rather slipshod way in which the Minister made his remarks on this Amendment. He is not very good at answering questions. I realise that he has not yet advanced to the stage of making a long series of consecutive answers but I should like him to give a definite reply to the point which I have raised.

Captain Sir WILLIAM BRASS: If, as the Minister said in his reply, there would be a loss of revenue by increasing the limit up to 250 lbs., it means that there are a large number of motor cycles in this country of a weight up to 250 lbs. We manufacture in this country the finest motor bicycles in the world, and we ought to encourage the manufacturers as much as possible. The Minister has said that they did not seem dissatisfied with the 224 lbs. which he has suggested. They would be much more pleased if the weight were increased to the amount suggested in the Amendment. We must remember why these weights were put on. They were put on not only far the purposes of revenue, but because of the destruction of the roads, and it is assumed that a motor bicycle of 224 lbs. will not do as much damage to the roads as one weighing 250 lbs. I do not think, however, that a motor bicycle does any real damage to the roads. This little concession might be given therefore, for it would help our export trade by giving our motor-bicycle manufacturers an opportunity of building a slightly bigger machine with a little more horse power. Besides that, the motor bicycle is becoming the poor man's motor car, and he takes his wife out on the back of it as a pillion-rider. Very often he attaches a side-car, and one often sees on the road a large motor bicycle of considerable horse power with a side-car carrying a whole family. If the Minister could see his way to give this little concession, he would give a fillip to motor-bicycle manufacturers in this country.

Mr. A. M. SAMUEL: The Minister of Transport told us that the manufacturers would be satisfied with the 224 lbs. Are we to understand that they would not like the larger poundage? I can say as a former Secretary to the Overseas Trade Department that the motor-bicycle trade was one where we were doing extremely well. I agree with my hon. and gallant Friend who has returned from the Protectorates in East Africa. I remember well we were doing an extremely good trade with motor bicycles in the uncivilised parts of Africa, and if by increasing the weight of these cycles we can make them slightly stronger, so that they will stand the rough roads and means of communication in East Africa and West Africa, where we have a pretty good business, it might, without hurting the revenue, bring us employment which would more than make up anything that might be lost to the revenue in raising the weight of the machines. Although the manufacturers were content with 224 lbs., does the Minister tell us that they have not assured him that a slight increase in the weight would increase their power to sell abroad? If he can assure us of that, we might take a different view; if he cannot assure us, we shall have to take this Amendment to a Division.

Mr. HERBERT MORRISON: I really do not see that it is part of the duty of the Chancellor of the Exchequer to give as a concession to people more than they are satisfied with. I have informed the Committee that the manufacturers are satisfied with the concession which we are giving. The hon. Gentleman asked us whether they would like more. Quite likely they would, but they agreed with this concession, and, having come to a business arrangement it would be unbusinesslike on my part and on that of my right hon. Friend to give people beyond that to which they have agreed. This has no relation to the Dominions or the overseas market. Presumably the manufacturers are already making cycles of the heavier kind which pay the heavier tax, and the question of which category the cycles fall into is beside the point so far as the overseas market is concerned. They are already making vehicles of the type to which the hon. and gallant Gentleman referred, and therefore, if the Dominion market wants
them, it can have them without this Amendment being made. I do not think the Committee will expect me to deal exhaustively with the hon. Member for Torquay (Mr. C. Williams). The manufacturers were British. The other points of the hon. Gentleman's speech are rather a needless attempt to be superior at my expense, and I do not think any discussion with him on that point would be helpful, but I would assure him that in his presence I have not the slightest feeling of inferiority at all.

Mr. MOND: If the Minister's theory were carried out manufacturers would have to make two kinds of cycles, one for the export market, and one for the home market. Everyone knows, however, that mass production is the only method of cheap manufacture, and the effect will be just the opposite to what he wants, for it will not encourage employment. There are not a great many manufactures in which England is dominant, but the motor cycle is one. We entirely dominate the world in the manufacture of this machine, and I appeal to the Minister not to say, "We have made a business agreement about this, and the manufacturers have not asked for any more." We all know what these Treasury deals are. Probably, under a severe threat of getting nothing at all, they were allowed to have a little bit. We ask him to take a different view of the position. He says that he will lose revenue by doing it. Perhaps he will, but if he does, it shows that we have a strong case. As a matter of fact, however, he will lose so little that he has not been able to calculate it. The Government are not being very generous to the manufacturers on this point, and I appeal to the Minister to make this concession.

Captain CROOKSHANK: Surely the Minister remembers what happened with regard to the motor car trade. We have always been told that our difficulties in exporting to the foreign market are due to the fact that this House interfered by putting the horse-power tax on motor cars. The Minister is now running the risk of falling into the same error with regard to motor bicycles. We have now got the great bulk of the world trade in motor cycles, and do not let us run any risk of restricting or hampering that trade. It is an extraordinary theory
for the Minister to say that he is doing it because the traders asked him for a concession. So long as he is in such an accommodating mood in regard to the first 24 lbs. above the 200 lbs., why does he not go a little further and say that there will be nothing to restrict the size of motor bicycles? It is a simple problem. If there is any difficulty about definition that could be done in another way, but this is merely a question of weight, and do not let us put the motor cycle trade in the unfortunate position in which the motor industry has been put through the interference of this House.

Mr. POTTS: I want to appeal to the Minister to reconsider his decision on this point. I do so for quite different reasons from those put forward by hon. Members on the other side. I appeal to the Minister to reconsider his decision in

the interests of those who ride. Not long ago I went through the Ariel and A.J.S. works, and saw what was being done to strengthen motor bicycles. Many people have to travel to work on motor bicycles, and we want to make the tax as low as we can while enabling them to ride the stronger-made bicycles. The Chancellor might lose a certain amount of money by allowing this increase of weight, but we would get more safety for the rider. It would affect a large number of people, while not being a serious matter to the Exchequer. I am not concerned with the manufacturers, but with the people who ride motor bicycles, and I hope that the Minister will meet them in order to enable them to reduce their licence expenditure.

Question put, "That '224' stand part of the Clause."

The Committee divided; Ayes; 286; Noes, 155.

Division No. 330.]
AYES.
[6.30 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Daggar, George
Henderson, Right Hon. A. (Burniey)


Adamson, W. M. (Staff., Cannock)
Dallas, George
Henderson, Arthur. Junr. (Cardiff, S.)


Addison, Rt. Hon. Dr. Christopher
Dalton, Hugh
Henderson, Thomas (Glasgow)


Aitchison, Rt. Hon. Craigie M.
Davies, Rhys John (Westhoughton)
Henderson, W. W. (Mlddx., Enfield)


Alexander, Rt. Hon. A. V. (Hillsbro')
Denman, Hon. R. D.
Herriotts, J.


Alpass, J. H.
Dickson, T.
Hirst, G. H. (York W. R. Wentworth)


Ammon, Charles George
Dudgeon, Major C. R.
Hirst, W. (Bradford, South)


Arnott, John
Dukes, C.
Hoffman, P. C.


Aske, Sir Robert
Duncan, Charles
Hopkin, Daniel


Attlee, Clement Richard
Ede, James Chuter
Horrabin, J. F.


Ayles, Walter
Edmunds, J. E.
Hudson, James H. (Huddersfield)


Baker, John (Wolverhampton, Bilston)
Edwards, C. (Monmouth, Bedwellty)
Hunter, Dr. Joseph


Baldwin, Oliver (Dudley)
Edwards, E. (Morpeth)
Hutchison, Maj.-Gen. Sir R.


Barnes, Alfred John
Egan, W. H.
Isaacs, George


Batey, Joseph
Elmley, Viscount
Jenkins, W. (Glamorgan, Neath)


Beckett, John (Camberwell, Peckham)
England, Colonel A.
John, William (Rhondda, West)


Bellamy, Albert
Foot, Isaac
Johnston, Thomas


Benn, Rt. Hon. Wedgwood
Freeman, Peter
Jones, F. Llewellyn- (Flint)


Bennett, Capt. Sir E. N. (Cardiff C.)
Gardner, B. W. (West Ham, Upton)
Jones, Henry Haydn (Merioneth)


Benson, G.
Gardner, J. P. (Hammersmith, N.)
Jones, J. J. (West Ham, Silvertown)


Bevan, Aneurin (Ebbw Vale)
George, Megan Lloyd (Anglesea)
Jones, Rt. Hon. Leif (Camborne)


Birkett, W. Norman
Gibbins, Joseph
Jones, Morgan (Caerphilly)


Bowen, J. W.
Gibson, H. M. (Lancs, Mossley)
Jones, T. I. Mardy (Pontypridd)


Broad, Francis Alfred
Gill, T. H.
Jowett, Rt. Hon. F. W.


Brockway, A. Fenner
Gillett, George M.
Jowitt, Rt. Hon. Sir W. A.


Bromfield, William
Gossling, A. G.
Kennedy, Thomas


Bromley, J.
Gould, F.
Kenworthy, Lt.-Com. Hon. Joseph M.


Brooke, W.
Graham, D. M. (Lanark, Hamilton)
Kinley, J.


Brothers, M.
Graham, Rt. Hon. Wm. (Edin., Cent.)
Kirkwood, D.


Brown, C. W. E. (Notts. Mansfield)
Granville, E.
Lambert, Rt. Hon. George (S. Molton)


Brown, Ernest (Leith)
Gray, Milner
Lang, Gordon


Brown, Rt. Hon. J. (South Ayrshire)
Grenfell, D. R. (Glamorgan)
Lansbury, Rt. Hon. George


Brown, W. J. (Wolverhampton, West)
Griffith, F. Kingsley (Middlesbro' W.)
Lathan, G.


Buchanan, G.
Griffiths, T. (Monmouth, Pontypool)
Law, Albert (Bolton)


Buxton, C. R. (Yorks. W. R. Elland)
Groves, Thomas E.
Law, A. (Rosendale)


Caine, Derwent Hall-
Grundy, Thomas W.
Lawrence, Susan


Cameron, A. G.
Hall, F. (York, W. R., Normanton)
Lawson, John James


Carter, W. (St. Pancras, S W.)
Hall, G. H. (Merthyr Tydvil)
Lawther, W. (Barnard Castle)


Charieton, H. C.
Hall, Capt. W. P. (Portsmouth, C.)
Leach, W.


Chater, Daniel
Hamilton, Mary Agnes (Blackburn)
Lee, Frank (Derby, N. E.)


Church, Major A. G.
Hamilton, Sir R. (Orkney & Zetland)
Lee, Jennie (Lanark, Northern)


Clarke, J. S.
Harbord, A.
Lees, J.


Cluse, W. S.
Hardie, George D.
Lewis, T. (Southampton)


Clynes, Rt. Hon. John R.
Harris, Percy A.
Lloyd, C. Ellis


Cocks, Frederick Seymour.
Hastings, Dr. Somerville
Logan, David Gilbert


Compton, Joseph
Haycock, A. W.
Lonqbottom, A. W.


Cove, William G.
Hay day, Arthur
Longden, F.


Cowan, D. M.
Hayes, John Henry
Lovat-Fraser, J. A.


Lowth, Thomas
Parkinson, John Allen (Wigan)
Sorensen, R.


Lunn, William
Perry, S. F.
Stamford, Thomas W.


Macdonald, Gordon (Ince)
Peters, Dr. Sidney John
Stephen, Campbell


Macdonald, Rt. Hon. J. R. (Seaham)
Pethick-Lawrence, F. W.
Stewart, J. (St. Roilox)


MacDonald, Malcolm (Bassetlaw)
Picton-Turbervill, Edith
Strachey, E. J. St. Loe


McElwee, A.
Pole, Major D. G.
Strauss, G. R.


McEntee, V. L.
Price, M. P.
Sullivan, J.


McKinlay, A.
Quibell, D. J. K.
Sutton, J. E.


MacLaren, Andrew
Ramsay, T. B. Wilson
Taylor, R. A. (Lincoln)


Maclean, Sir Donald (Cornwall, N.)
Rathbone, Eleanor
Taylor, W. B. (Norfolk, S. W.)


MacNeill-Weir, L.
Richards, R.
Thomas, Rt. Hon. J. H. (Derby)


McShane, John James
Richardson, R. (Houghton-le-Spring)
Thorne, W. (West Ham. Plaistow)


Malone, C. L'Estrange (N'thampton)
Riley, Ben (Dewsbury)
Thurtle, Ernest


Mander, Geoffrey le M.
Riley, F. F. (Stockton-on-Tees)
Tinker, John Joseph


Mansfield, W.
Ritson, J.
Toole, Joseph


March, S.
Romeril, H. G.
Tout, W. J.


Markham, S. F.
Rosbotham, D. S. T.
Townend, A. E.


Marley, J.
Rowson, Guy
Trevelyan, Rt. Hon. Sir Charles


Mathers, George
Runciman, Rt. Hon. Walter
Turner, B.


Matters, L. W.
Russell, Richard John (Eddisbury)
Vaughan, D. J.


Melville, Sir James
Salter, Dr. Alfred
Viant, S. P.


Messer, Fred
Samuel, Rt. Hon. Sir H. (Darwen)
Walkden, A. G.


Middleton, G.
Samuel, H. W. (Swansea, West)
Walker, J.


Millar, J. D.
Sanders, W. S.
Wallace, H. W.


Mills, J. E.
Sawyer, G. F.
Wallhead, Richard C.


Milner, Major J.
Scott, James
Walters, Rt. Hon. Sir J. Tudor


Montague, Frederick
Scrymgeour, E.
Watkins, F. C.


Morgan, Dr. H. B.
Scurr, John
Watson, W. M. (Dunfermline)


Morley, Ralph
Sexton, James
Watts-Morgan, Lt.-Col. D. (Rhondda)


Morris, Rhys Hopkins
Shaw, Rt. Hon. Thomas (Preston)
Welsh, James (Palsley)


Morris-Jones, Dr. J. H. (Denbigh)
Shepherd, Arthur Lewis
West, F. R.


Morrison, Herbert (Hackney, South)
Sherwood, G. H.
Westwood, Joseph


Morrison, Robert C. (Tottenham, N)
Shield, George William
White, H. G.


Mort, D. L.
Shillaker, J. F.
Whiteley, Wilfrid (Birm., Ladywood)


Moses, J. J. H.
Shinwell, E.
Whiteley, William (Blaydon)


Mosley, Lady C. (Stoke-on-Trent)
Short, Alfred (Wednesbury)
Williams, David (Swansea, East)


Muff, G.
Simon, E. D. (Manch'ter, Withington)
Williams, Dr. J. H. (Lianelly)


Muggeridge, H. T.
Sinclair, Sir A. (Caithness)
Williams, T. (York, Don Valley)


Nathan, Major H. L.
Sinkinson, George
Wilson, C. H. (Sheffield, Attercliffe)


Naylor, T. E.
Sitch, Charles H.
Wilson, J. (Oldham)


Newman, Sir R. H. S. D. L. (Exeter)
Smith, Alfred (Sunderland)
Wilson, R. J. (Jarrow)


Noel Baker, P. J.
Smith, Frank (Nuneaton)
Winterton, G. E. (Leicesler, Loughb'gh)


Oliver, George Harold (Ilkeston)
Smith, H. B. Lees- (Keighley)
Wise, E. F.


Oliver, P. M. (Man., Blackley)
Smith, Rennie (Penistone)
Wood, Major McKenzie (Banff)


Owen, Major G. (Carnarvon)
Smith, Tom (Pontefract)
Wright, W. (Ruthergien)


Owen, H. F. (Hereford)
Snell, Harry
Young, R. S. (Islington, North)


Palin, John Henry
Snowden, Rt. Hon. Philip



Palmer, E. T.
Snowden, Thomas (Accrington)
TELLERS FOR THE AYES.—




Mr. Ben Smith and Mr. Paling.


NOES.


Acland-Troyte, Lieut.-Colonel
Colfox, Major William Philip
Grenfell, Edward C. (City of London)


Albery, Irving James
Colman, N. C. D.
Gunston, Captain D. W.


Atkinson, C.
Colville, Major D. J.
Hacking, Rt. Hon. Douglas H.


Baldwin, Rt. Hon. Stanley (Bewdley)
Cranborne, Viscount
Hamilton, Sir George (Ilford)


Balfour, George (Hampstead)
Crichton-Stuart, Lord C.
Hannon, Patrick Joseph Henry


Balfour, Captain H. H. (I. of Thanet)
Croft, Brigadier-General Sir H.
Hartington, Marquess of


Balniel, Lord
Crookshank, Cpt. H. (Lindsey, Gainsbro)
Harvey, Major S. E. (Devon, Totnes)


Beaumont, M. W.
Croom-Johnson, R. P.
Haslam, Henry C.


Berry, Sir George
Culverwell, C. T. (Bristol, West)
Henderson, Capt. R. R. (Oxf'd, Henley)


Betterton, Sir Henry B.
Cunliffe-Lister, Rt. Hon. Sir Philip
Hennessy, Major Sir G. R. J.


Birchall, Major Sir John Dearman
Dalkeith, Earl of
Herbert, Sir Dennis (Hertford)


Bird, Ernest Roy
Dalrympie-White, Lt.-Col. Sir Godfrey
Hills, Major Rt. Hon. John Waller


Bourne, Captain Robert Croft
Davidson, Rt. Hon. J. (Hertford)
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.


Bowyer, Captain Sir George E. W.
Davidson, Major-General Sir J. H.
Horne, Rt. Hon. Sir Robert S.


Boyce, H. L.
Davies, Dr. Vernon
Hudson, Capt. A. U. M. (Hackney, N.)


Bracken, B.
Davison, Sir W. H. (Kensington, S.)
Hurd, Percy A.


Brass, Captain Sir William
Duckworth, G. A. V.
Hurst, Sir Gerald B.


Briscoe, Richard George
Eden, Captain Anthony
Iveagh, Countess of


Brown, Col. D. C. (N'th'l'd., Hexham)
Edmondson, Major A. J.
Jones, Sir G. W. H. (Stoke New'gton)


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Elliot, Major Walter E.
Kedward, R. M. (Kent, Ashford)


Buchan, John
Erskine, Lord (Somerset, Weston-s.-M.)
Kindersley, Major G. M.


Bullock, Captain Malcolm
Everard, W. Lindsay
Lamb, Sir J. O.


Burton, Colonel H. W.
Falle, Sir Bertram G.
Lane Fox, Col. Rt. Hon. George R.


Cadogan, Major Hon. Edward
Ferguson, Sir John
Leighton, Major B. E. P.


Cautley, Sir Henry S.
Fielden, E. B.
Locker-Lampson, Rt. Hon. Godfrey


Cayzer, Sir C. (Chester, City)
Fison, F. G. Clavering
Long, Major Eric


Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.)
Fremantle, Lieut.-Colonel Francis E.
Macquisten, F. A.


Cazalet, Captain Victor A.
Gibson, C. G. (Pudsey & Otley)
MacRobert, Rt. Hon. Alexander M.


Chamberlain, Rt. Hn. Sir J. A. (Birm., W.)
Gilmour, Lt.-Col. Rt. Hon. Sir John
Makins, Brigadier-General E.


Chamberlain, Rt. Hon. N. (Edgbaston)
Glyn, Major R. G. C.
Marjoribanks, E. C.


Chapman, Sir S.
Gower, Sir Robert
Mason, Colonel Glyn K.


Christie, J. A.
Graham, Fergus (Cumberland, N.)
Mond, Hon. Henry


Churchill, Rt. Hon. Winston Spencer
Grattan-Doyle, Sir N.
Monsell, Eyres. Com. Rt. Hon. Sir B.




Morrison, W. S. (Glos., Cirencester)
Sandeman, Sir N. Stewart
Turton, Robert Hugh


Nicholson, O. (Westminster)
Savery, S. S.
Wallace, Capt. D. E. (Hornsey)


Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)
Shepperson, Sir Ernest Whittome
Ward, Lieut.-Col. Sir A. Lambert


O'Connor, T. J.
Sinclair, Col. T. (Queen's U., Belfst)
Wardlaw-Milne, J. S.


O'Neill, Sir H.
Smith, Louis W. (Sheffield, Hallam)
Warrender, Sir Victor


Ormsby-Gore, Rt. Hon. William
Smith-Carington, Neville W.
Waterhouse, Captain Charles


Peake, Capt. Osbert
Smithers, Waldron
Wayland, Sir William A.


Percy, Lord Eustace (Hastings)
Somerville, A. A. (Windsor)
Wells, Sydney R.


Pownall, Sir Assheton
Somerville, D. G. (Willesden, East)
Williams, Charles (Devon, Torquay)


Pybus, Percy John
Southby, Commander A. R. J.
Wilson, G. H. A. (Cambridge U.)


Ramsbotham, H.
Spender-Clay, Colonel H.
Windsor-Clive, Lieut.-Colonel George


Rawson, Sir Cooper
Stanley, Maj. Hon. O. (W'morland)
Winterton, Rt. Hon. Earl


Remer, John R.
Steel-Maitland, Rt. Hon. Sir Arthur
Wolmer, Rt. Hon. Viscount


Reynolds, Col. Sir James
Stewart, W. J. (Belfast South)
Womersley, W. J.


Richardson, Sir P. W. (Sur'y, Ch't'sy)
Stuart, Hon. J. (Moray and Nairn)
Wood, Rt. Hon. Sir Kingsley


Roberts, Sir Samuel (Ecclesall)
Sueter, Rear-Admiral M. F.
Worthington-Evans, Rt. Hon. Sir L.


Russell, Alexander West (Tynemouth)
Thomson, Sir F.



Salmon, Major I.
Tinne, J. A.
TELLERS FOR THE NOES.—


Samuel, A. M. (Surrey, Farnham)
Titchfield, Major the Marquess of
Captain Margesson and Sir George


Samuel, Samuel (W'dsworth, Putney)
Tryon, Rt. Hon. George Clement
Penny.

The following Amendment stood upon the Order Paper in the name of Lieut.-Colonel HENEAGE:

In page 5, line 9, at the end, to insert the words:
(c) at the end of the Schedule shall be added the following:
'If any person proves to the satisfaction of the authority charged with levying the duty that he has paid in respect of any motor vehicle the duty chargeable under this schedule, and that such vehicle is used only for agricultural or market-gardening purposes, he shall be entitled to repayment of 50 per cent. of the duty paid.'

Viscount WOLMER: May I ask whether the Amendment in the name of the hon. and gallant Member for Louth (Lieut.-Colonel Heneage) is out of order, or is it merely that you have not selected it?

The DEPUTY-CHAIRMAN: There is another Amendment dealing with the question farther down on the Order Paper, and I am calling that as it appeared on the Order Paper first.

Mr. HERBERT MORRISON: I beg to move, in page 5, line 10, after the word "who," to insert the words:
is the holder of a licence which was taken out.
This and the following Amendment are really little more than drafting Amendments. The new duty under Sub-section (2) comes into operation on the 1st of July, and refunds will therefore be necessary on annual licences in respect of the second half of the calendar year. Refunds can only be made to the holder of the licence at the time, who is not necessarily the person who took out the licence originally. My Amendment has been put down to make it clear that it will
be the holder of the licorice who will get the benefit and not the person who originally took it out, because there may have been changes in the ownership of the vehicle in the meantime. If this and the following Amendment be inserted the Clause will read:
Any person who is the holder of a licence which was taken out before the first day of July, nineteen hundred and thirty, in respect of any vehicle to which Sub-section (2) of this section applies.

Mr. A. M. SAMUEL: We do not propose to offer any opposition to this Amendment so long as we understand in plain English that these alterations are made to protect the interests of the present holders of the licence. Can the hon. Gentleman give us that undertaking?

Mr. MORRISON: Yes; the Amendment is to secure the interest of the present holders of the licences.

Amendment agreed to.

Further Amendment made: In page 5, line 11, to leave out the words:
has taken out a licence."—[Mr. Herbert Morrison.]

Mr. HERBERT MORRISON: I beg to move, in page 5, line 13, after the word "shall," to insert the words:
on surrendering the licence to the council of the county or county borough with which the vehicle is for the time being registered.
The object of this Amendment is to secure that a person claiming a refund shall surrender the licence to the licensing authority for the county or county borough concerned. That is necessary for accounting purposes, in order to see that the licence is in the form commonly issued, and also to prevent any defrauding of the revenue. This Amendment
will provide machinery for that purpose, and I am sure it will commend itself to the Committee.

Mr. A. M. SAMUEL: Here, again, we do not propose to offer any objection to the Amendment, so long as we have an undertaking from the hon. Gentleman that the holder surrendering the licence will be in no way damnified by so doing.

Mr. MORRISON: That is so.

Sir W. BRASS: I wish to ask whether it is really necessary to put in these words; and I also wish to know what happens to the licence. When it is sent back to the Council and the Council have taken notice of it, is it then sent back to the owner?

Mr. MORRISON: The licence is kept by the licensing authority which, however, will issue a new licence.

Amendment agreed to.

Mr. HERBERT MORRISON: I beg to move, in page 5, line 19, at the end, to add the words:
and Sub-section (2) of Section fourteen of the Finance Act, 192G (which relates to the enforcement of repayments in respect of over-payments of duty on licences for mechanically-propelled vehicles) shall apply as if the holder of the licence were entitled to a repayment in respect of an over-payment of duty.
This Amendment will prevent claims being made after the 31st December next year, and we are simply following the precedent set by Section 14 of the Finance Act, 1926.

Amendment agreed to.

Mr. SMITHERS: I beg to move, in page 5, line 19, after the words last inserted, to add the words:
Provided that the duty which shall be charged, levied, and paid in respect of all mechanically-propelled vehicles, while they are used for the purposes of agriculture or market gardening, shall be at half the rates chargeable under Section thirteen of the Finance Act, 1920, as specified in paragraph 4 of the Second Schedule to that Act.
In the Finance Act, 1920, there are laid down certain rates of duty payable by mechanically-propelled vehicles, and the object of this Amendment is to reduce the duty by one-half for mechanically-propelled vehicles used for the purposes of agriculture or by market gardeners. During the past few months we have made attempts on this side of the House
time after time to get the Government to do something to benefit the farmers and the market gardeners of this country, but up to the present we have not been successful. Therefore, it is necessary for us to make another attempt in this direction. We made an attempt on the beer Clauses to get a certain kind of beer brewed from home-grown ingredients, and now we are making an attempt to obtain some benefit for the persons engaged in the business of agriculture and market gardening.
My own Division suffers very much from foreign competition. There is between my Division and the coast miles of market gardens, and the great bulk of the produce from those gardens has to come along the arterial roads of the county by motor lorries. Some of those gardeners employ two or three, and, in some cases, four motor lorries for this purpose. I put market gardening in my Amendment because, when a previous Bill was being considered and the late Minister of Transport was in charge, it was not made quite clear whether market gardening came under the definition of a farmer or a person engaged in agriculture. Here is a great industry not only in my Division but all round London and the big towns, in which a great deal of capital has been sunk in putting up glass houses. One man I know has premises which cover 11 acres of ground. These people produce an enormous amount of delicate produce for the food and comfort of those living in the big cities, and practically all of them send their produce to the markets by motor lorries.
I beg the Chancellor of the Exchequer to give this slight help to the agricultural interest, because agriculture at the present time is suffering under very great difficulties. Unfortunately, the season in my county is a few weeks behind the season across the water, and one of our greatest difficulties is to compete with the early season produce which is sent over to this country by the foreigner. I am asking for this relief in order to help our market gardeners and farmers to compete with the foreigner. On Easter Monday I visited Salisbury Market, and I took particular notice of the large number of motor lorries in use by the farmers of that district. I am asking for this benefit for the farmer and for the market
gardener, as well as for the man who grows the more perishable kind of produce. This Amendment would also give real assistance to the arable farmers. In the city of Salisbury on market day the roads leading to the market place are blocked with motor lorries bringing in cows and pigs and all kinds of produce alive and dead. I have several friends engaged in this business. One of them represents the Farmers' Union of Wiltshire, and they all say with the utmost sincerity—they are a, plucky lot and do not "grouse" unnecessarily—that they have had a very bad time, and any little help the Government can give them will be fully appreciated.
It may be said that the number of these vehicles in use for farming purposes is not very great. If that is going to be the reply of the Minister of Transport, then I claim that it supports this Amendment, because one of the reasons why more motor lorries are not used for farming and agricultural purposes is the heavy tax upon them. I feel confident that the Chancellor of the Exchequer will see his way to halve the tax on motor lorries which are used mainly for agriculture and market gardening, and if he grants this concession I am sure he will not lose anything, because I feel confident that there will be a greater demand for this kind of transport in the near future, especially in the outlying districts. I appeal to the Chancellor of the Exchequer to give the farmers and market gardeners a little encouragement, and help them to compete with the produce that comes over from France, Holland, and Belgium. We saw in the paper this morning that an old Savoyard had been given an honour by the King, and I would ask the Chancellor of the Exchequer—there is nothing personal about this—not to come into the category mentioned by one of his characters of
Then the idiot who praises, with enthusiastic tone,
All centuries but this, and every country but his own.
I make an appeal to the right hon. Gentleman to help our country by giving this concession to the farmers to enable them the better to compete with foreign produce, which is put upon the London market.

Mr. HERBERT MORRISON: I am afraid that the hon. Member for Chislehurst
(Mr. Smithers) cannot have appreciated the very material concessions which have been made in the past on this subject, and the very good position which is enjoyed by the agricultural community. We have all listened with sympathy to the claims put forward by the hon. Member on behalf of agriculture, but, while I am clear as to the intention of the Amendment, I am not very clear as to whether it would be workable. May I inform the hon. Member that market gardening, in any case, is included in the legal definition of agriculture for this purpose. Clause 47 (5) which deals with this point provides that:
Any reference in this Act to any enactment shall be construed as a reference to that enactment as amended by any subsequent enactment, including this Act.

Mr. SMITHERS: Is there any chance of the spirit of my Amendment being accepted? I have done my best to draft it by looking through the Act, and if I have drafted it wrongly, I hope that the Minister will not allow that to militate against an Amendment being introduced on the Report stage. I am not wedded to these words at all, and if the Minister of Transport can suggest some other form of words, of course I shall be willing to accept them.

Mr. MORRISON: I am afraid it is worse than that. We are not only not wedded to the hon. Member's words, but we are not wedded to his ideas on the subject. The reference to paragraph 4 of the Second Schedule of the Finance Act, 1920, must be taken as a reference to paragraph 4 as finally amended by the Finance Act, 1927. That paragraph must be read in conjunction with the First Schedule to the Finance Act, 1926. The Government are not responsible for these complications; in fact, we have a grievance because we have to explain them. This enactment provides a scale of duties for farm tractors from £6 to £10 in respect of tractors registered under the Act of 1920 in the name of a person engaged in agriculture and used by the owner for the haulage of produce or articles required for the purposes of the agricultural land which he occupies, and not for any other purposes.

Sir A. STEEL-MAITLAND: Is that under the Act of 1928?

Mr. MORRISON: There are three Acts involved. They are the Acts of 1920, 1926 and 1927, and there does not appear to be any point with regard to the Act of 1928. It will be seen, therefore, that the duty on a tractor used for agricultural purposes is from £6 to £10, whereas the duty on an ordinary vehicle is from £21 to £60. I think the Committee will agree that £6 to £10 as compared with £21 to £60 is a very big concession to the agricultural industry which Governments have made from time to time.
7.0 p.m.
The Amendment refers to all mechanically-propelled vehicles, whether tractors or others, and without confining them to the period while they are being used for the purposes of agriculture. Therefore, the Amendment would include lorries as well as tractors. The scale of duties as set out in the Finance Act, 1928, which provides the scales of duties in respect of vehicles used for agriculture, subject to the definition I have already quoted, ranges from £10 to £25.

Mr. SMITHERS: Which Schedule?

Mr. MORRISON: I have not the Schedule by me, but the scale is, as I have said, from £10 to £25, and, in addition to scales for various special classes, there is a scale of from £10 to £60 in respect of ordinary goods-carrying vehicles. Therefore, we have the scale of £10 to £25, and for ordinary vehicles £10 to £60. It will be seen, therefore, that vehicles used for agricultural purposes receive a substantial preference. There is a further reason against the Amendment. It would extend a special concession, made to agriculturists as such, to any owner whose vehicle is used, by contract or otherwise, in connection with agricultural purposes, while so used. For instance, it would cover the merchant who carries the goods to market. It will be seen that the Amendment is much wider in its effect than the Committee might be led to think from the speech of the hon. Member who moved it. I think it might hardly be appreciated, from the hon. Member's remarks, what substantial concessions the agricultural industry already enjoys. For the reasons indicated, my right hon. Friend does not see his way to accept the Amendment.

Sir A. STEEL-MAITLAND: When the Minister talked about the considerable
advantage already given to agriculture under the Act of 1928, he contended that the tax on these vehicles went up to £20, whereas on the other vehicles it went up to £60, but if he looks at the scale he will see that for the scale on an ordinary vehicle, for agricultural use, which is £20, there is a corresponding duty on ordinary vehicles, not used for agricultural purposes, of only £25. Therefore, the advantage is not so great as might be thought by anyone hearing the figures which the Minister has quoted.

Viscount WOLMER: I am sorry that the Chancellor of the Exchequer has refused to accept this Amendment, even in a form of words which would be suitable to himself. It seems to be impossible to extract any concession for agriculture, no matter how small, out of the present Government. The sole reply of the Minister of Transport was to point to the concessions made by the last Government to help agriculturists. Those concessions, so far as they went, were very valuable, but it is no reply on the part of the hon. Gentleman merely to point to the help which his predecessors gave to agriculture, and to refuse to move a little finger himself to carry the good work any further. I will put to him briefly the reasons why we think this demand, in the present state of agriculture, is legitimate. If the agricultural industry was flourishing and prosperous, this request would not be pressed by representatives of agricultural constituencies, but in the present state of agriculture I submit that there is no little help that it is in the power of this House to give that we ought to decline to give. I put it to the Chancellor of the Exchequer that any assistance he gives to farmers and to market gardeners in this respect may be of very considerable importance to them but have only an insignificant effect on his Budget as a whole. This is specially true of market gardeners, who, generally speaking, are small men, and the amount of money they have invested in a lorry and the amount they spend on running the lorry represents a serious item in their finances, whereas the relief for which we are asking in this Amendment would be an insignificant sum in the Budget of the Chancellor of the Exchequer.
The hon. Gentleman does not say how much it would cost the Government.
I cannot help feeling that he must have those figures in front of him, and if he gave the figures to the Committee it would be found that they were exceedingly small. Valuable as were the concessions which the right hon. Member for Epping (Mr. Churchill) made, I cannot think why they cannot be carried further. In the first place, the reduced duty that tractors pay is a concession which certainly might be carried further. A tractor used for ploughing and threshing makes practically no use of the roads at all. If farmers are careful—and most of them are—to use iron tyres while moving from field to field and using the road, they will do practically no damage to the roads. The whole of their life is spent on the farm, and they merely cross the roads occasionally for the purpose of going from field to field. Since the Motor Duties and the Petrol Duty are intended for the upkeep of roads, I do not see why agricultural tractors should make any contribution at all towards the Road Fund. With regard to petrol, it is true that a great many agricultural tractors do not go on petrol, but use mainly paraffin, but there are a great number that do use petrol, and I would bring to the notice of the hon. Gentleman that every penny going to the Petrol Duty from the use of these agricultural tractors is payment towards the upkeep of the roads of which these tractors make no use. Agricultural tractors, therefore, are still too heavily taxed both in regard to licences and in regard to duty.
Then we come to the lorries. It is quite a mistake to think that a farmer's lorry is used entirely on the roads; it is not. The lorry is used a great deal in going about from place to place on the farm, and the whole of that work imposes a heavy strain on the lorry itself, and can be taken to represent much more wear and tear than a similar mileage covered on the roads. Yet the whole of that work does no damage to the roads at all. That is a further reason why the duty on lorries should be reduced. I would like to put this point to the Minister of Transport, because it is one about which farmers feel keenly, that the whole of this high motor taxation and the great Road Fund it has produced, and the great arterial roads with their slippery surfaces, are of no use to the
farmer. They are, in fact, a very great source of inconvenience, danger and loss to the farmers of this country. The amount of damage which farmers receive through horses and other animals slipping on these roads is very high, and, therefore, the farmer legitimately regards it as adding insult to injury that he should be taxed, even to the present extent, for the upkeep of those roads in a condition which may be desirable from the point of view of the motorist and the road-hog, but which is of no use to agriculture as a whole. Therefore, I express my disappointment that the Government, even on this minor question, have refused to move even a little finger to help the agriculturist of this country. As my hon. Friend the Mover of the Amendment said, we have waited for 12 months for their agricultural policy, and have given them every opportunity to help the farmer. We want to afford them an opportunity to give this help which the farming community, through their official accredited organisation, has demanded, and which would cost the Chancellor of the Exchequer very little indeed.

Mr. HASLAM: I do not think we have to find any further argument to show the depressed state of agriculture at the present time. The Minister of Transport, in refusing this Amendment or anything like it, with such limiting words as he might have desired to put in, suggested that the concesions which were given by the last Government were sufficient. I would point out that the state of agricurture is even worse now than it was a few years ago. Bad as the times were then, at any rate we had the hope that things would be better, but, instead, they have become steadily worse, and year after year—it had now been going on for nearly 10 years—farmers have been losing and have found their capital resources depleted, in many cases almost to vanishing point. The Schedule, as I understood from the Act of 1928, gave practically no concession at all to the lighter forms of lorries, and the light lorry is one that is used very much by farmers. It is also a vehicle which does very little damage to roads. In the old days, when the duties on heavy vehicles were increased substantially, it was done very largely on the ground that these vehicles did a lot of damage to the roads. In those days that was true, but every year since, with the
improvement of types, and with the greater use made of pneumatic tyres, the damage to roads by heavy vehicles has been considerably lessened.
In any case, as my right hon. Friend has pointed out, these lorries which are used by farmers are used a great deal on the farm itself. Finally, I would point out that a tax on transport is surely not a very wise tax. Our competitors abroad, particularly in France and Belgium, have at their disposal a very efficient and cheap form of transport in the light railways which run along the sides of the roads, and which are propelled, I think, very largely by steam. I would submit that on the face of it this tax on transport is, for a farmer, a very large sum of money. It was £25 under the old Schedule, but under this proposed Schedule, as I understand it, for vehicles exceeding two tons and up to 2½ tons, the tax will be from £28 to £35, while for vehicles exceeding 2½ tons and up to three tons it will be from £32 to £40. Considering the financial position of farmers in this country, I submit that these charges are, as a tax, altogether too high. They must considerably more than cover any damage to the roads which these vehicles do, and I would ask the Chancellor of the Exchequer and the Committee to consider whether this is really a wise and sound method of raising money. I suggest that it is a most unsound method, and that to lighten the charges on transport is a legitimate way of helping agriculture, and one which, in the present circumstances, should be followed by the House of Commons.

Sir A. STEEL-MAITLAND: I want to reinforce what was said by my Noble Friend the Member for Aldershot (Viscount Wolmer). What the Minister of Transport said about there being an advantage to agriculture, is quite true in the case of heavy vehicles, but in the case of the lighter vehicles there is no advantage to agriculture at all. For vehicles not exceeding 12 cwt. in weight unladen, the annual tax for each vehicle is £10. For vehicles exceeding 12 cwt. but not exceeding a ton it is £15, and for vehicles exceeding a ton but not exceeding 1½ ton it is £20 in each case. I think it is quite clear that the great majority of the ordinary lorries used by
farmers, at any rate in my district, are either one-ton lorries or, sometimes, 25-cwt. lorries. They all come within these lower categories. On the whole, the farmers do not use them continuously, in the way that a merchant does who makes a business of conveying goods all over the place. I would put it to the Chancellor of the Exchequer and the Minister of Transport that a concession on these vehicles would mean comparatively little money to the Exchequer, but, if the Chancellor of the Exchequer can see his way to do it on Report, it would be extraordinarily appreciated, as some recognition of their position, by the farming community. They have been asked to be more scientific, and to carry out their business by modern methods, and it is precisely the most up-to-date of them who have lorries, and for whom some reduction in the tax on these three lower categories, on which they have now no advantage, would be of very great use indeed.

Mr. HERBERT MORRISON: It is perfectly true, as the right hon. Gentleman has said, that in the second category—the non-tractor category—the relief is not felt until we get to the heavier type of vehicle, but in the first category, that is to say, the tractor type, the relief is a very real one all the way through. I quite agree that in the case of the non-tractor vehicle it is not such a real concession all the way through—

Sir A. STEEL-MAITLAND: It is not a real concession in the case of this class, of which these vehicles form the great majority.

Mr. MORRISON: I have no doubt that the Government at that time, and the Chancellor of the Exchequer at that time, had a good reason for handling the matter in that way, and I gather that it was this, that in the case of the lighter type of lorry the tax was relatively low in any case, but, when you got to the heavier type, the tax became a real and substantial burden to the agricultural industry in the conditions of that time. Therefore, the Chancellor of the Exchequer in that Government made this concession in order to relieve the heavier type of agricultural vehicle. On the other hand, the Chancellor of the Exchequer at that time could not, for reasons which no doubt commended themselves to him,
make the concession in the case of the lighter vehicles.
The Noble Lord, however, is very much in error as to the position of vehicles which are used as agricultural implements on agricultural land, because it is provided, under the present system of taxation, that locomotive ploughing engines, agricultural tractors, and other agricultural engines not being engines or tractors used for hauling on roads any object except their own necessary gear, threshing appliances, farm implements, or supplies of fuel or water required for the purposes of the vehicle or for agricultural purposes, only pay a nominal registration fee of 5s. a year, and are otherwise completely relieved. Even though such a vehicle may go on a road, if it is merely there of necessity, for the purpose of carrying its own gear, threshing appliances, farm implements, fuel or water, it only pays 5s. a year. The Committee will see, therefore, that the concessions have been very real, and we do not feel like finding further concessions. The argument of the hon. Member appears to be on the basis that all the efforts of the late Government to improve the condition of the agricultural industry have left agriculture worse in the end than it was at the beginning. It further implies that the right hon. Gentleman, in making his concessions, did not make them big enough. Our own present feeling is that the concessions were real and, substantial, and my right hon. Friend, for the reasons indicated, does not feel that the Committee would he wise to accept the present Amendment.

Mr. MacLAREN: I do not know how far one can influence the Chancellor of the Exchequer in this matter, but I am in wholehearted sympathy with this Amendment. I think that it is a really serious Amendment, which ought to have some consideration, if not now, at a later stage in the consideration of the Bill. The hon. Member for Chislehurst (Mr. Smithers) complained that the heavy taxation on these vehicles was the cause of the scarcity of their use in agriculture, but I think that the Petrol Duty has more to do with it than the Motor Duty, and that the De-rating Act and its consequences are a greater hardship in regard to the use of motor vehicles than the immediate tax on the vehicle itself. While the wording of the Amendment
would not very well suit the purpose for which it is proposed, I think that some form of words conveying the principle might be considered by the Chancellor of the Exchequer.
I do not quite agree with the Minister of Transport in his comparisons with other vehicles paying heavier taxation, but I do not think it is a bad thing to say to anybody, "You are not so badly off as the other fellow; look how bad lie is." I think it would be a good thing for the Labour party if they took some such line as is indicated in this Amendment, and reduced as far as possible the taxation on vehicles used in industry. I do not want it to go out that, as has been alleged on the other side, the Chancellor of the Exchequer is adamant in regard to any concession towards agriculture, and that is all the more reason why I ask him, though I do not know what success I shall meet with, for some consideration for this Amendment.
We have heard a good deal about the hardships of agriculture, and it is interesting to notice that, when the Conservative party are in Opposition, they become very strong advocates for the un-taxing of industry and vehicles, though they are not so enthusiastic on that matter when they are on this side. However that may be, I would ask the Chancellor of the Exchequer to consider something along the lines of this Amendment and I would like to ask him this question: If the concession suggested in the Amendment were granted, what would be the cost? I was rather amused at the irate disposition of the Noble Lord the Member for Aldershot (Viscount Wolmer) when he was declaiming a few moments ago. He said that these very fine roads which were made by means of the Petrol Duty are too high-class for agriculturists, and simply become skidding alleys for these tractors. What does the Noble Lord want us to do? Does he want us to make them nicely rutted, so that he may get back to his old cart-tracks again? I hope that the Chancellor of the Exchequer will not think that this is a new insurrection on the back benches, but will recognise that I am really quite serious in asking him if he will consider something in the spirit of the Amendment which has been put forward.

Mr. WARDLAW-MILNE: I merely rise to add my voice to the appeal to the
Chancellor of the Exchequer to consider, between now and further stages of the Bill, whether he cannot make some concession of this kind. I remember that a year or two ago this question of the taxation of motor vehicles carrying agricultural produce was brought forward again and again, especially by the small agriculturists, and I entirely agree with what has just been said by the hon. Member for Burslem (Mr. MacLaren). The position was undoubtedly seriously accentuated in the minds of the small agriculturists at the time of the Petrol Duty. That was bound to be so. We all object to taxation, and the only point of my appeal to the Chancellor of the Exchequer is that, as has been shown today, the smaller vehicle really does not have any particular advantage. Agriculturists who use these one-ton or 1½-ton vehicles have practically no advantage, or only a very small advantage, and any small concession that the Chancellor of the Exchequer could give would be a real consideration to the small agriculturist. Therefore, I would press him to consider the matter between now and report.

Sir WILLIAM WAYLAND: To-day, as has been pointed out already, the position with regard to agricultural lorries is quite different from what it was 12 months ago. Lorries now have to be used more and more in order to reduce agricultural

expenses. Agriculture to-day is in a far worse position than any other industry in the country. It has to meet more unfair competition than any other industry, and, therefore, it has a right to more consideration than any other industry. The taxation of motor vehicles in every other country is very much lower than in this country. In Normandy and the South of France, in Belgium, and in Italy, where they compete with our farmers in the early markets, they have a great advantage, and, therefore, taking everything into consideration, the question of a tax upon the farmer's lorry is one of great importance. When you ask the farmer to be up-to-date in his operations and to employ a motor vehicle in place of horses, especially in conveying his produce to the town, the tax upon the vehicle is to him a great consideration. The farmer does not employ his lorry more than a small part of the day, and he does not employ it every day of the week; and, therefore, again, he should be considered when compared with lorry owners who are running their lorries every day. I hope also, as every little helps, and it is a series of littles that make a muckle, that the Chancellor will agree to this reduction.

Question put, "That those words be there added."

The Committee divided: Ayes, 170; Noes, 252.

Division No. 331.]
AYES.
[7.33 p.m.


Acland-Troyte, Lieut.-Colonel
Churchill, Rt. Hon. Winston Spencer
George, Megan Lloyd (Anglesea)


Aske, Sir Robert
Colfox, Major William Philip
Gibson, C. G. (Pudsey & Otley)


Atkinson, C.
Colman, N. C. D.
Gilmour, Lt.-Col. Rt. Hon. Sir John


Baldwin, Rt. Hon. Stanley (Bewdley)
Colville, Major D. J.
Gower, Sir Robert


Balfour, George (Hampstead)
Courthope, Colonel Sir G. L.
Graham, Fergus (Cumberland, N.)


Balfour, Captain H. H. (I. of Thanet)
Cowan, D. M.
Granville, E.


Balniel, Lord
Cranborne, Viscount
Grattan-Doyle, Sir N.


Beaumont, M. W.
Crichton-Stuart, Lord C.
Gray, Milner


Berry, Sir George
Croft, Brigadier-General Sir H.
Grenfell, Edward C. (City of London)


Betterton, Sir Henry B.
Crookshank, Cpt. H. (Lindsey, Gainsbro)
Hacking, Rt. Hon. Douglas H.


Birchall, Major Sir John Dearman
Croom-Johnson, R. P.
Hall, Lieut.-Col. Sir F. (Dulwich)


Bird, Ernest Roy
Culverwell, C. T. (Bristol, West)
Hamilton, Sir George (Ilford)


Bourne, Captain Robert Croft
Cunliffe-Lister, Rt. Hon. Sir Philip
Hannon, Patrick Joseph Henry


Boyce, H. L.
Dalkeith, Earl of
Hartington, Marquess of


Bracken, B.
Davies, Dr. Vernon
Harvey, Major S. E. (Devon, Totnes)


Brass, Captain Sir William
Davison, Sir W. H. (Kensington, S.)
Haslam, Henry C.


Briscoe, Richard George
Dixey, A. C.
Henderson, Capt. R. R. (Oxf'd, Henley)


Brown, Col. D. C. (N'th'l'd., Hexham)
Eden, Captain Anthony
Hennessy, Major Sir G. R. J.


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Edmondson, Major A. J.
Herbert, Sir Dennis (Hertford)


Buckingham, Sir H.
Elliot, Major Walter E.
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.


Bullock, Captain Malcolm
Elmley, Viscount
Horne, Rt. Hon. Sir Robert S.


Burgin, Dr. E. L.
England, Colonel A.
Hudson, Capt. A. U. M. (Hackney, N.)


Butler, R. A.
Erskine, Lord (Somerset, Weston-s-M.)
Hurd, Percy A.


Cadogan, Major Hon. Edward
Everard, W. Lindsay
Hurst, Sir Gerald B.


Carver, Major W. H.
Falle, Sir Bertram G.
Jones, F. Llewellyn- (Flint)


Cautley, Sir Henry S.
Ferguson, Sir John
Jones, Sir G. W. H. (Stoke New'gton)


Cayzer, Sir C. (Chester, City)
Fielden, E. B.
Jones, Henry Haydn (Merloneth)


Chamberlain, Rt. Hn. Sir J. A. (Birm., W.)
Fison, F. G. Clavering
Kedward, R. M. (Kent, Ashford)


Chamberlain, Rt. Hon. N. (Edgbaston)
Ford, Sir P. J.
Knox, Sir Alfred


Christie, J. A.
Fremantle, Lieut.-Colonel Francis E.
Lamb, Sir J. Q.


Lambert, Rt. Hon. George (S. Molton)
Pownall, Sir Assheton
Stanley, Lord (Fylde)


Lane Fox, Col. Rt. Hon. George R.
Pybus, Percy John
Stanley Maj. Hon. O. (W'morland)


Leighton, Major B. E. P.
Ramsay, T. B. Wilson
Steel-Maitland, Rt. Hon. Sir Arthur


Locker-Lampson, Rt. Hon. Godfrey
Ramsbotham, H.
Stewart, W. J. (Belfast South)


Long, Major Eric
Rawson, Sir Cooper
Stuart, Hon. J. (Moray and Nairn)


Macdonald, Capt. P. D. (I. of W.)
Remer, John R.
Sueter Rear-Admiral M. F.


MacLaren, Andrew
Reynolds, Col. Sir James
Thomas, Major L. B. (King's Norton)


Macpherson, Rt. Hon. James I.
Richardson, Sir P. W. (Sur'y, Ch't'sy)
Titchfield, Major the Marquess of


MacRobert, Rt. Hon. Alexander M.
Roberts, Sir Samuel (Ecclesall)
Todd, Capt. A. J.


Maitland, A. (Kent, Faversham)
Ross, Major Ronald D.
Tryon, Rt. Hon. George Clement


Makins, Brigadier-General E.
Russell, Alexander West (Tynemouth)
Wallace, Capt. D. E. (Hornsey)


Marjoribanks, E. C.
Russell, Richard John (Eddisbury)
Walters, Rt. Hon. Sir J. Tudor


Mason, Colonel Glyn K.
Salmon, Major I.
Ward, Lieut.-Col. Sir A. Lambert


Mond, Hon. Henry
Samuel, A. M. (Surrey, Farnham)
Wardlaw-Milne, J. S.


Monsell, Eyres, Com. Rt. Hon. Sir B.
Samuel, Samuel (W'dsworth, Putney)
Warrender, Sir Victor


Morris-Jones, Dr. J. H. (Denbigh)
Sandeman, Sir N. Stewart
Wayland, Sir William A.


Morrison, W. S. (Glos., Cirencester)
Savery, S. S.
Wells, Sydney R.


Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)
Scott, James
Williams, Charles (Devon, Torquay)


Nield, Rt. Hon. Sir Herbert
Shepperson, Sir Ernest Whittome
Wilson, G. H. A. (Cambridge U.)


O'Connor, T. J.
Sinclair, Sir A. (Caithness)
Withers, Sir John James


Oman, Sir Charles William C.
Sinclair, Col. T. (Queen's U., Belfst)
Wolmer, Rt. Hon. Viscount


O'Neill, Sir H.
Smith, Louis W. (Sheffield, Hallam)
Womersley, W. J.


Owen, Major G. (Carnarvon)
Smith-Carington, Neville W.
Wood, Rt. Hon. Sir Kingsley


Owen, H. F. (Hereford)
Smithers, Waldron
Worthington-Evans, Rt. Hon. Sir L.


Peake, Capt. Osbert
Somerville, A. A. (Windsor)



Penny, Sir George
Somerville, D. G. (Willesden, East)
TELLERS FOR THE AYES.—


Percy, Lord Eustace (Hastings)
Southby, Commander A. R. J.
Captain Margesson and Sir Frederick


Peto, Sir Basil E. (Devon, Barnstaple)
Spender-Clay, Colonel H.
Thomson.


NOES.


Adamson, Rt. Hon. W. (Fife, West)
Ede, James Chuter
Kinley, J.


Adamson, W. M. (Staff., Cannock)
Edmunds, J. E.
Kirkwood, D.


Addison, Rt. Hon. Dr. Christopher
Edwards, E. (Morpeth)
Lang, Gordon


Aitchison, Rt. Hon. Craigie M.
Egan, W. H.
Lathan, G.


Alexander, Rt. Hon. A. V. (Hillsbro')
Freeman, Peter
Law, Albert (Bolton)


Alpass, J. H.
Gardner, B. W. (West Ham. Upton)
Law, A. (Rosendale)


Ammon, Charles George
Gardner, J. P. (Hammersmith, N.)
Lawrence, Susan


Arnott, John
Gibbins, Joseph
Lawson, John James


Ayles, Walter
Gibson, H. M. (Lancs, Mossley)
Lawther, W. (Barnard Castle)


Baker, John (Wolverhampton, Bilston)
Gill, T. H.
Leach, W.


Baldwin, Oliver (Dudley)
Gossling, A. G.
Lee, Frank (Derby, N. E.)


Barnes, Alfred John
Gould, F.
Lee, Jennie (Lanark. Northern)


Batey, Joseph
Graham, D. M. (Lanark, Hamilton)
Lees, J.


Beckett, John (Camberwell, Peckham)
Graham, Rt. Hon. Wm. (Edin., Cent.)
Lewis, T. (Southampton)


Bellamy, Albert
Grenfell, D. R. (Glamorgan)
Lloyd, C. Ellis


Bennett, Capt. Sir E. N. (Cardiff C.)
Griffith, F. Kingsley (Middlesbro' W.)
Logan, David Gilbert


Benson, G.
Griffiths, T. (Monmouth, Pontypool)
Longbottom, A. W.


Bentham, Dr. Ethel
Groves, Thomas E.
Longden, F.


Bevan, Aneurin (Ebbw Vale)
Grundy, Thomas W.
Lovat-Fraser, J. A.


Birkett, W. Norman
Hall, F. (York, W. R., Normanton)
Lowth, Thomas


Bowen, J. W.
Hall, G. H. (Merthyr Tydvil)
Lunn, William


Broad, Francis Alfred
Hall, Capt. W. P. (Portsmouth, C.)
Macdonald, Gordon (Ince)


Brockway, A. Fenner
Hamilton, Mary Agnes (Blackburn)
MacDonald, Malcolm (Bassetlaw)


Bromfield, William
Hamilton, Sir R. (Orkney & Zetland)
McElwee, A.


Bromley, J.
Harbord, A.
McEntee, V. L.


Brooke, W.
Hardie, George D.
McKinlay, A.


Brothers, M.
Harris, Percy A.
McShane, John James


Brown, C. W. E. (Notts, Mansfield)
Hastings, Dr. Somerville
Malone, C. L'Estrange (N'thampton)


Brown, Ernest (Leith)
Haycock, A. W.
Mander, Geoffrey le M.


Brown, Rt. Hon. J. (South Ayrshire)
Hayday, Arthur
Mansfield, W.


Brown, W. J. (Wolverhampton, West)
Hayes, John Henry
March, S.


Buchanan, G.
Henderson, Arthur, Junr. (Cardiff, S.)
Markham, S. F.


Burgess, F. G.
Henderson, Thomas (Glasgow)
Marley, J.


Buxton, C. R. (Yorks. W. R. Elland)
Henderson, W. W. (Mlddx., Enfield)
Mathers, George


Caine, Derwent Hall-
Herriotts, J.
Matters, L. W.


Cameron, A. G.
Hirst, G. H. (York W. R. Wentworth)
Maxton, James


Carter, W. (St. Pancras, S. W.)
Hirst, W. (Bradford, South)
Melville, Sir James


Charieton, H. C.
Hoffman, P. C.
Messer, Fred


Chater, Daniel
Hopkin, Daniel
Middleton, G.


Church, Major A. G.
Horrabin, J. F.
Mills, J. E.


Clarke, J. S.
Hudson, James H. (Huddersfield)
Milner, Major J.


Cluse, W. S.
Isaacs, George
Montague, Frederick


Clynes, Rt. Hon. John R.
Jenkins, W. (Glamorgan, Neath)
Morgan, Dr. H. B.


Cocks, Frederick Seymour
John, William (Rhondda. West)
Morley, Ralph


Compton, Joseph
Johnston, Thomas
Morris, Rhys Hopkins


Cove, William G.
Jones, J. J. (West Ham, Silvertown)
Morrison, Herbert (Hackney, South)


Daggar, George
Jones, Rt. Hon. Leif (Camborne)
Morrison, Robert C. (Tottenham, N.)


Dallas, George
Jones, Morgan (Caerphilly)
Mort, D. L.


Davies, E. C. (Montgomery)
Jones, T. I. Mardy (Pontypridd)
Moses, J. J. H.


Davies, Rhys John (Westhoughton)
Jowett, Rt. Hon. F. W.
Mosley, Lady C. (Stoke-on-Trent)


Denman, Hon. R. D.
Jowitt, Rt. Hon. Sir W. A.
Muff, G.


Dickson, T.
Kelly, W. T.
Muggeridge, H. T.


Dukes, C.
Kennedy, Thomas
Nathan, Major H. L.


Duncan, Charles
Kenworthy, Lt.-Com. Hon. Joseph M.
Naylor, T. E.




Oldfield, J. R.
Shield, George William
Turner, B.


Oliver, George Harold (Ilkeston)
Shillaker, J. F.
Vaughan, D. J.


Oliver, P. M. (Man., Blackley)
Shinwell, E.
Viant, S. P.


Palin, John Henry
Short, Alfred (Wednesbury)
Walkden, A. G.


Paling, Wilfrid
Simmons, C. J.
Walker, J.


Palmer, E. T.
Simon, E. D. (Manch'ter, Withington)
Wallace, H. W.


Parkinson, John Allen (Wigan)
Sinkinson, George
Wallhead, Richard C.


Perry, S. F.
Sitch, Charles H.
Watkins, F. C.


Peters, Dr. Sidney John
Smith, Alfred (Sunderland)
Watson, W. M. (Dunfermline)


Pethick-Lawrence, F. W.
Smith, Ben (Bermondsey, Rotherhithe)
Watts-Morgan, Lt.-Col. D. (Rhondda)


Picton-Turbervill, Edith
Smith, Frank (Nuneaton)
Wellock, Wilfred


Pole, Major D. G.
Smith, H. B. Lees- (Keighley)
Welsh, James (Paisley)


Potts, John S.
Smith, Rennie (Penistone)
West, F. R.


Price, M. P.
Smith, Tom (Pontefract)
Westwood, Joseph


Quibell, D. J. K.
Snell, Harry
White, H. G.


Richards, R.
Snowden, Rt. Hon. Philip
Whiteley, Wilfrid (Birm., Ladywood)


Richardson, R. (Houghton-le-Spring)
Snowden, Thomas (Accrington)
Wilkinson, Ellen C.


Riley, F. F. (Stockton-on-Tees)
Sorensen, R.
Williams, David (Swansea, East)


Ritson, J.
Stamford, Thomas W.
Williams, Dr. J. H. (Llaneily)


Romeril, H. G.
Stephen, Campbell
Williams, T. (York, Don Valley)


Rosbotham, D. S. T.
Stewart, J. (St. Rollox)
Wilson, C. H. (Sheffield, Attercliffe)


Rowson, Guy
Strauss, G. R.
Wilson, J. (Oldham)


Salter, Dr. Alfred
Sullivan, J.
Wilson, R. J. (Jarrow)


Samuel, Rt. Hon. Sir H. (Darwen)
Sutton, J. E.
Winterton, G. E. (Leicester, Loughb'gh)


Samuel, H. W. (Swansea, West)
Taylor, R. A. (Lincoln)
Wise, E. F.


Sanders, W. S.
Taylor, W. B. (Norfolk, S. W.)
Wood, Major McKenzie (Banff)


Sawyer, G. F.
Thorne, W. (West Ham, Plaistow)
Young, R. S (Islington, North)


Scrymgeour, E.
Thurtle, Ernest



Scurr, John
Tiliett, Ben
TELLERS FOR THE NOES.—


Sexton, James
Tinker, John Joseph
Mr. Charles Edwards and Mr.


Shepherd, Arthur Lewis
Tout, W. J.
William Whiteley.


Sherwood, G. H.
Townend, A. E.



Question put, and agreed to.

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Sir L. WORTHINGTON-EVANS: Will the Minister of Transport tell us what is the actual amount of cash obtained by this Clause? He said that it was only small, but I do not think he gave the exact amount.

Mr. HERBERT MORRISON: The right hon. Gentleman, perhaps, was not here when I informed the right hon. Gentleman the Member for Epping (Mr. Churchill) that the financial equivalent of the concessions obtained in the whole Clause are estimated to be between £80,000 and £100,000 in a full financial year.

Sir L. WORTHINGTON-EVANS: What is the amount of the 50 per cent. rebate for electrically-driven vehicles?

Mr. MORRISON: That information I was unable to give. On the existing number of vehicles it is an insignificant sum, but clearly, if the trade understood that the 50 per cent. rebate on the petrol-electric vehicle, which can do equivalent service to that of the petrol vehicle, was permanent, that class of vehicle would increase in numbers and the number of petrol vehicles would be reduced. In that case, the cost could be very big. We do not know the exact amount, but it is a small sum.

Sir L. WORTHINGTON-EVANS: Under £1,000?

Mr. MORRISON: I could not say that, but relatively a small sum.

CLAUSE 7.—(Income Tax for 1930–31.)

Mr. CHURCHILL: I beg to move, in page 5, line 24, to leave out the words "and sixpence."
Before I embark on the general discussion on Income Tax which is raised by this Amendment, I should like to ask the Chancellor of the Exchequer whether he would impart to the Committee his governing ideas as to the extent to which we should endeavour to progress tonight. We have had a discussion on Clause 6, in which the Minister of Transport has been most patient and has given us very full and lucid explanations of every point that has been raised. We have now reached one of the most important Clauses in the whole Bill, and I think it would be advantageous, if the Government have any statement to make, to make it now.

The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden): I am at all times very anxious not to harass the Committee, but I cannot say that I am satisfied with the progress that has been made up to the present time. I had
hoped that we might at this sitting get as far as Clause 11, but, unless the Committee sits very late, I am afraid that we shall not get so far. I think, however, that we must get to the end of Clause 9. I have no wish that the Committee should sit late. I want to take into consideration the convenience of every Member of the Committee, and especially the inability of my predecessor in this office to sit late. It is true that we have now come to the Clause which relates to the Income Tax, and which raises very important matters, but as these matters have been debated at very considerable length in the previous stages of our discussions on the Budget, important as they are, prolonged discussion upon them would not serve any very useful purpose. I do not want unnecessarily to restrict the debate, but I feel that I must get Clause 9, and I think that I might ask for the co-operation of the Opposition in trying to make that amount of progress.

Mr. CHURCHILL: I do not think that, at first sight, anyone would say that the ambition which the Chancellor of the Exchequer has set before himself, to reach the end of Clause 9, is an unreasonable one in the circumstances, although it undoubtedly will involve very considerable contraction of our discussion upon Clause 7, which is the important Clause. I gather that it is the wish of the Chancellor of the Exchequer that we should not be kept here until an unreasonable hour. We will try our best to accelerate the discussion, while at the same time doing full justice to the many important points which arise. There is one circumstance which may somewhat facilitate our task, and that is that you, Mr. Dunnico, have ruled that the extremely important Amendments which we had put down as Amendments to this Clause would be better considered as new Clauses. Therefore, our task is lightened in that respect by your interpretation and Ruling upon the procedure. That being so I will, without more ado, address myself, as briefly as I can, to the immediate issue before the Committee.
This Clause is an extremely important and far-reaching one. The right hon. Gentleman proposes to raise the standard rate of Income Tax by 6d. That is a most melancholy event and one against
which I have struggled year after year with every resource and effort open to me. If I had been told when the War came to an end that 10 years afterwards we should be reimposing 6d. on the Income Tax, and that after having gradually worked the tax down to the 4s. level we should have to retrace our steps, I should have regarded it with the keenest feelings of misfortune. The standard rate of the Income Tax is a matter which affects not only the large numbers of people who have to pay the tax but, in its way, casts its influence upon almost every form of our activities and social life. It has been explained how it affects business and enterprise. We know well how it affects the fortunes of individuals. I think the Chancellor of the Exchequer would have been well advised to make further efforts, for this year at any rate, when times are so hard and depression is so widespread, to avert the hardship of the re-imposition of 6d. upon the Income Tax.
I do not believe that this reimposition was necessary. If the Chancellor of the Exchequer on succeeding to office had set before himself, with all his strong determination, an inflexible resolve not to allow the expenditure of the country to increase by one penny, and to make sure that automatic increases were counterbalanced and more than counterbalanced by fresh savings, imposed by his energy and care; if he had been a little less rigid and rigorous in the repayment of debt over and above what is required for the purpose of the fixed debt charge; and if he had set his face against indulgences in the sphere of unemployment and widows' pensions there would not have been any case this year for the re-imposition of this heavy burden. This is the year that counts, this is the year in which we are passing through, perhaps, the most difficult stage of our immediate journey.
I have on several occasions spoken of the submerged areas of Income Tax, the large proportion of industries and businesses in which the profits yielded bear no real correspondence to what normally may be expected; businesses carried on on a much larger scale than is the yield to the Income Tax, because those businesses are not carried on upon a reasonable and profitable basis. The party opposite have, at the outset, to make up
their minds whether they are going to welcome profits made by private industry and by private capitalists and tax those profits, or whether they are going, by every means in their power, to curtail and hamper those profits and then forego the consequent yield to the Excheqer. That is the choice and decision which really lies before them. But they have not clarified their minds; they have deliberately refrained from arriving at any clear mental or intellectual decision upon that point, with the result that we hear continued attacks upon the wealth of those who are called the idle rich, coupled with great regret when the yield of the Income Tax does not show its proper normal expansion. If you want an expansion of the Income Tax, so far from putting an additional 6d. upon it, the wise and shrewd course would be to effect a substantial reduction in the standard rate. No one knows what would have been the effects of a substantial reduction in the standard rate, if it were conjoined with a real re-establishment of national confidence and of enterprise throughout the country. It is quite possible that the right hon. Gentleman might have received from a lower rate of Income Tax, revenue greater than that which he will get from this additional burden.
I speak particularly of the heavy trades, but the phenomena which are present in those trades are equally to be traced in many other aspects of our public life. This heavy taxation, more than any other invisible factor, is making us share in world depression to a disproportionate extent, and when the world lifts out of the depression, as it will lift, and when the prices begin to rise and business to expand, it is this deadweight burden of taxation which may make us the last country to emerge from the dark defile, and may make us the country to emerge in the most battered and exhausted condition. Therefore, far from extolling the virtue of taxation, far from glorifying in the imposition of this heavy burden, it should be the task and duty of a Government by every means in their power to nurse the country through its difficult periods and to lighten and reduce the demands which they make upon the taxpayers for the maintenance and upkeep of the State.
The right hon. Gentleman, by so blithely placing this heavy addition upon the standard rate of Income Tax, and at the same time showing himself reluctant and unwilling to place any addition upon the indirect taxpayers, and also by restricting the scope of the Income Tax payers thus affected by the tax, has created an invidious condition and has invested his Budget with an unfair character which certainly has caused in this House and outside a distinct impression that he is not being guided by the true canons of finance and is not seeking with that broad impartiality that should belong to whoever holds his great office, to act evenly in the distribution of benefits or in the needful apportionment of hardships and evils; but, on the other hand, he is mingling politics at every step and at every stage in his financial decisions, and is vitiating the purity of the solutions which he offers us by the admixture of extraneous motives which are themselves part of the stock-in-trade of his political popularity.
When we come to an Income Tax of 4s. being raised at a time of peace to 4s. 6d., the old Gladstonian canons of finance and the old views which were taken as to the relative advantages and disadvantages of direct and indirect taxation, must be reviewed and reconsidered. In those days when we were told of the grave injury done to the consumer by indirect taxation, and of the possibility that more would be taken from the pockets of the taxpayer than would be actually gathered into the public coffers, those evils were contrasted with increases in the Income Tax of 1d., or at the outside 2d., on an Income Tax of 5d. or 6d.
8.0 p.m.
I remember well hearing a predecessor of the right hon. Gentleman, the late Mr. Ritchie, reducing the Income Tax after the South African war, and he made a sort of auctioneer's gesture of it and took it off "One penny," "Twopence," "Threepence," and when he uttered the word "Fourpence," the House was almost in a state of collapse from hysteria, there was such enthusiasm and relief. But in those days, when the taxation was practically non-existent, when it was no real burden, when no man making business plans or laying down his own expenditure in the immediate future could be harassed by the inroad of the tax collector, then indeed you might use all the old arguments
which may be properly applied to indirect taxation; but now that the first preoccupation of most of the larger Income Tax payers in this country is to find the money to pay their Income Tax, when that is the first charge, as it were, upon their resources and the main cause in many cases of their anxieties, in these days you inflict, in my opinion, a far greater deterrent upon business and enterprise by a further addition to the tax than could be argued even by the most strict Free Trader or economist would be inflicted by a moderate addition to indirect taxation, even though the yield might not in all cases be fully reaped by the Treasury.
As I say, there are many processes which may be allowed to continue, although they have evil effects, because they are on a small scale and can be tolerated and borne, but as the burden rises, as the degree of intensity of taxation increases, so it becomes all the more important to examine all the anomalies, to dwell upon the special hardships, and to canvass with the most searching scrutiny the whole foundation, basis, and character of the tax. There are many aspects of this tax which we shall have to pass in review. Some few we shall deal with this evening, but others we shall definitely raise in the series of new Clauses which we have placed upon the Paper, and which, under the guidance of the Chair, must now be considerably extended. I trust that the right hon. Gentleman will, in his speech, address himself to the main and broad considerations which arise upon the tax. We think that we could best assist him in making progress with his Bill if we have a very full discussion on the general question of the increase of the tax. A very full discussion, Mr. Young, with your permission, would, I think, be in accordance with the wishes of the Committee and its general convenience; and then, when we come to the Amendments, we will dispose of them as quickly as we can and divide upon them, so that we may register our opinions on each point, and at the same time have had the advantage of one general, comprehensive debate.
I have only attempted to inaugurate an open and general discussion in these few remarks, which I have endeavoured to curtail as much as possible. But the
right hon. Gentleman must be in no doubt about our attitude, which is one of emphatic protest against the policy of raising the standard rate of the Income Tax by 6d. at the present juncture; a policy which, we are sure, will add to our difficulties far more than it will relieve the revenue problem of the right hon. Gentleman and will, it is quite conceivable, prolong the period of misfortune through which we are passing and possibly leave us, when that period is over, definitely weakened for every purpose of domestic advance or of external progress.

Sir WILLIAM DAVISON: On a point of Order. Ought we to continue our proceedings in this important matter without a single Member of the Liberal party being present?

Mr. OLIVER STANLEY: The case of direct taxation has been so fully and ably put by hon. Friends of mine in this and previous debates, that there is little new that can be added from this side, but if it is difficult for us to find something new, it is at least easy for the right hon. Gentleman the Chancellor of the Exchequer to find something new to say on this topic. If he would consent to abandon the taunts, jeers, and witticisms in which so far he has answered us, he would give us great satisfaction. I am the last man to decry the merits of his speeches—I recognise how good they are—but they are the kind which belong essentially to the politics of pre-War days, the kind which in those days were held to establish the reputation of the statesman, to encourage the enthusiasm of the party, and to enhance the prestige of the Government.
But we must remember that in those days we carried on discussions such as this against a background of what we believed to be the inevitable and unassailable prosperity of this country. We might have surface commotions, this politician might be thrown out, this party might sink down, but the stream of British trade continued undisturbed. To-day things are different. To-day not even the optimists among us believe that British prosperity is unassailable, and the pessimists among us are beginning to believe that British prosperity is unattainable, but all of us are agreed that the time has gone by when there is any chance of this country muddling
through, and it is no longer trusted that there is some special Providence which will see that everything comes right in the end. We believe now that things will only come right in the end if to-day we think right and do right and decide right, and one of the greatest decisions which we have to take, one of the decisions which may affect the whole of our future prosperity, is the view we are going to take towards taxation in general and the heavy increase of direct taxation in particular.
It is interesting to see how this question affects our foreign observers. A letter was brought to my attention which shows the opinion of an American in regard to the effect that the general policy of this taxation will have on our industries. I must, of course, remind hon. Members opposite that, although the opinion I am going to quote is that of a foreigner, it is not necessarily right. This statement, from a letter which was sent out by a New York broker to certain clients in this country, and dated 15th April, the day after the Budget, starts as follows:
To-day the morning newspapers published the British Budget and showed the anticipated rise in taxes. After having read the Budget, it occurred to me very strongly that this should sharpen the appetite of the Britisher to want to invest in American securities.

Mr. J. JONES: Good old patriots!

Mr. STANLEY: The hon. Member has given me the cue which I hoped would be given, but I may point out that, leaving aside for the moment the question of patriotism, with which I will deal later, this letter does at least show that the foreign observer believes that on purely economic grounds the investor will prefer to invest his money in America rather than here; and although patriotism may affect the investor in this country, it cannot, of course, be expected to affect the foreign investor, who up to now has found the securities of this country the safest and best means for the investment of his capital. The hon. Gentleman raises the question of the patriotism of the British investor. I wonder if he has ever considered that the patriotism of the investor may to some extent depend on the use to which the money which has been taken from him is put.

Mr. J. JONES: All my investments are in this country. I have got four of them at home.

Mr. STANLEY: The hon. Member is like the brook, he goes on for ever. But it is worth while considering whether the patriotism which you are entitled to expect from the investor in this country does not to some extent depend on the use to which you put the money. I quite agree that, if the taxpayer is convinced that the taxes, however heavy, are being taken from him for purposes of national use, which are essential and vital to the restoration of prosperity in this country, that those taxes are being used as economically as possible, and spent as wisely as possible, then patriotism does demand that he should bear his fair share of the burden; and under similar circumstances during the War, when taxation rose to even higher heights than it reaches to-day, no one had any cause to complain of the patriotism of the taxpayer. But suppose conditions have changed, suppose the taxpayer believes that the taxes are being raised from him, not to be spent in a wise development of the prosperity of the country, but raised as part of the settled scheme of a particular political party, to eliminate a class of people who do not happen to fit in with their concept of a social and economic world, can you really blame him, or accuse him of a lack of patriotism, when he does not lend himself to the gentle schemes of hon. Members opposite?
I hope that in the course of the debate this evening we shall get some reasoned statement of the case of hon. Members opposite, if not by the Chancellor of the Exchequer, then by some other Member opposite who speaks with authority on finance. I know that hon. Members have made up their minds, that they believe our case to be wrong, but I believe too that a great many of them recognise that there are two sides to the question, that although they have come down upon one side, it is well worth putting the reason for their decision and trying to get support for their case upon reason and not upon prejudice. I see that the right hon. Gentleman the Prime Minister, only to-day, in a, message to some Labour body, made use of one of those mellifluous phrases which he employs. He said:
In this grave crisis the Government require the understanding support of the country.
I cannot see how he can expect, in this instance, the understanding support of anybody, unless he is prepared to give the reasons and not the prejudices which force him into these courses.
There are undoubtedly a great many questions which deserve an answer and which deserve discussion, but our case with regard to the ill-effect of direct taxation falls into two parts. I am leaving aside the question, which will be raised later, on the new Clauses, of the effect directly on industry owing to the taxation of reserves. Indirect taxation falls into two parts. We say, first, that it saps the energy and dulls the initiative of the individual, and, secondly, that it reduces the possibility of saving and, therefore, the capital available for use in industry. With regard to the first question, we are entitled to ask hon. Members opposite what they consider to be that effect upon the individual. We have had a good many divergent views expressed from the opposite side of the House. The Chancellor of the Exchequer, in his Budget speech, made use of certain phrases which certainly suggested to us on this side of the House that he realised that direct taxation had a psychological effect upon those responsible for running trade and industry. It is true that since that time he has done everything he can to water down that announcement. The right hon. Gentleman shakes his head, but the little anecdote he told the House about the doctor in Yorkshire who said that poison was all right if it was administered in small doses cannot really be held to have increased the confidence of the investor or, in fact, to have upheld the prominence he gave to it in the Budget speech.
The hon. Baronet the Member for Smethwick (Sir O. Mosley), who, I understand, to-day holds a great reputation for finance in the. Socialist party, clearly indicated in his speech last week that he recognised the taxable limit which, I rather gathered from him, had almost been reached already. I remember hon. Members on those benches who said that far from taxation being a damper upon the initiative of the industrialist it was actually a spur to his energy, and that
the more you taxed the man the harder he worked. We are entitled to know which of these two views actually prevail. Surely, nobody argues that if out of every pound that a man makes you take 19s. 6d. in taxation it is really an incentive to enterprise and that, when faced with retaining for himself 6d. out of every pound in profit, he is going to make these extra sacrifices of health, comfort and leisure or run the extra risks to his capital which any extension of activity might ensure. Similarly, no one is going to argue that an Income Tax of 6d. in the or a Surtax of a shilling in the £ is going to have any effect on damping down the initiative of the business man. Surely, the effect of taxation is cumulative and it only has its ill-effect upon industry when it reaches a certain point. We are entitled to know from the right hon. Gentleman if those are his views still, and what is the limit to which he thinks direct taxation can be put before those ill-effects become certain. We want that information in order to enable us to form our view of the expenditure which is going to be met.
There is the other question of the effect of high direct taxation upon capital savings. Is the question of saving one which we have to consider? I know a good many hon. Members opposite who hold very strongly the view that too much attention is paid to saving and too little to consumption. Is that the view of the right hon. Gentleman? If saving is important, are we in this country saving enough? Is our position with regard to saving so good that we do not need to worry? If we were to discourage foreign investments, should we have sufficient for our own national uses? There is a further question. Apart from our own national uses, what is the position of world saving to-day? If we are to damp down foreign investments and to be concerned only with sufficient saving to run our own side of production, what effect will that have on the economy of the world? Who will take our place? Ts America saving so much that she can become the lender to the world? Is France, although her capital position is so good, ever likely to become a good lender in the markets of the world? Is there anybody, if we were to confine saving to this country and this country alone, who could take our part in the financing of world industry?
Should we not suffer from it ourselves? Do not let us forget that we require capital just as much to buy as we require capital in order to save.
If saving is important, what is the effect of high direct taxation, of the distribution of income and of wealth by means of taxation, upon savings? Does it have a discouraging effect? If you take away £100 from one man and distribute £1 each to 100 men, does that action decrease the likelihood of that £100 finding investment in the industries of the country? Again, does not the use to which this money is put have considerable bearing upon the problem? If the taxation you raise is put to real productive use to finance national schemes which it can be demonstrated will redound to the productive capacity of the country, then it may quite well be argued, if that £100 is not to be spent upon the schemes but is to be distributed to social services and to 100 different people, you are merely gambling on the fact that some of those hundred men will save that pound and in turn invest it in industry. All these are points which should be discussed and points about which we are entitled to receive answers.
It may be said that this is academic; and in a way that is true. The right hon. Gentleman has presented his Budget and his direct taxation, and nothing said or done now will, I am sure, alter his opinion. But we have to remember the peculiar circumstances in which we find ourselves in this House. For 10 months in the year we discuss how we are going to spend the money, and for two months in the year we decide how we are going to raise it. The two things are never connected. We may spend weeks discussing a Bill which is going to entail an expenditure of £5,000,000 or £10,000,000, but we are never allowed to ask at that time how that money is to be raised. We never know whether that money is to be found out of savings or raised by this or that method of taxation. Therefore, it is essential that we should try now, during our only opportunity, to get some idea of what are the taxable limits of this country, to find out how soon all these limits will be reached, and to see if we cannot get some general survey of the financial requirements of the country and give preference to these needs which are most deserving.
The hon. Baronet the Member for Smethwick made a rather apt simile of the whole Front Bench opposite trying to get through the wicket-gate first to get something out of the Chancellor of the Exchequer. I was rather amused in the debate last week when the President of the Board of Education said how generous the Chancellor of the Exchequer had been in giving him so many millions for education. It is true that on these benches we have an antiquated constitutional idea that the money is not the Chancellor of the Exchequer's to give; that he is really the trustee of the taxpayer and that his generosity is at somebody else's expense, but it throws a light on our system of expenditure when those who are lucky in the struggle and get through the wicket-gate first call the Chancellor generous whilst those who are left in the rough call him cheeseparing. I am not concerned with any party advantage in this question of direct and indirect taxation; I am concerned with the state of the country. We are entitled to know from the Chancellor of the Exchequer if there is any limit and, if so, what, to our taxable capacity, because that and that alone will enable us to discuss Bills involving expenditure which may be brought forward during the next year on any reasonable basis and with any intelligent analysis.

Mr. E. C. GRENFELL: We have been discussing Budget matters in a somewhat different atmosphere from that which has prevailed during the last month, and it is a distinct advantage to the Committee that we should not start with fireworks and finish with fireworks. On the rare occasions on which the Chancellor of the Exchequer has visited the City of London he has gone there evidently determined to impress the people in the City not only with his wisdom but with his desire to restore the country to a state of confidence. In the peroration to his Budget speech, he stated that his one aim was to restore confidence in the country and that everyone should understand for the future what their taxation was to be. As far as restoring the confidence of the country is concerned, I would not say for a moment that he has destroyed it, but it has been severely strained. It is all very well to say that it is unpatriotic for a Britisher to send his money abroad. He has always done so in the past in order to develop fresh markets all over
the world, and it would be a sad thing if to-day those who are able to send their money abroad were to send it either for safety or because they thought that industries and factories abroad would be able to develop unhampered by unfair and unjust taxation.
For a long time there has been a disinclination to put money into home industries. I am not referring to the struggles between masters and men, to lock-outs or to strikes, but to the incidence of taxation. The whole object of the Government should be to see factories and industries slowly developed, unhampered, until they had gained such a position that they were able to exist without feeling that the first little bit of profit they made would be taken from them. The difficulties of developing any industry or invention are that you may make mistakes, and ought to be prepared to make great mistakes, on the chance of making a great success, of finding some new development or invention which will bring great profit to the country and more employment. That is impossible on the lines of present taxation. I am not accusing the present Chancellor of the Exchequer any more than former Chancellors of the Exchequer, but the fact is that no one in this country to-day really understands how taxation is going to affect industry. It does not matter when the tax is only 2d. or 6d., but to-day it is four shillings and sixpence, a very heavy charge as now levied.
In his Budget speech, the Chancellor of the Exchequer said that there were two and a quarter million Income Tax payers, and he rejoiced to think that there were only 50,000 who were paying 4s. in the £. That 50,000 seemed to be the people whom the Chancellor 1S especially anxious to nobble. The tax is now to be raised to 4s. 6d., and I understand that even less than 50,000 people will be called upon to pay it. When we talk about having sent money abroad in the past, we must remember that the rich men in those days were nearly always landowners. Everyone considered that the rich landlords were the men who bought works of art and went about the country as the great financial potentates. To-day, the landowner is probably one of the poorest. He cannot
send his house and his land abroad. But the rich man, with his knowledge of finance, and the fact that his assets are mobile can transfer his property abroad, and no doubt in certain cases men have done so, and will continue to do so. That is a distinct loss to the Chancellor of the Exchequer. Money invested abroad may pay Income Tax and Surtax, but I think the Chancellor will admit that there is a considerable leakage in his receipts from money sent abroad as compared with what he would get from the same amount of income if it was earned here.
I challenge the right hon. Gentleman to say that he does not lose a great deal in that way. I am to a certain extent a banker and almost daily I am asked by customers about foreign loans and bonds, and how they can escape taxation. I will not tell the Committee what my answer is, but it is certain that clever people will devise methods for their clients to send their money abroad; and you cannot blame them. The Committee must remember that in the past, when there has been political oppression, the inhabitants of almost every European country have endeavoured to send their assets abroad and eventually have gone themselves. A large measure of prosperity was brought to this country by the Hugenot families who escaped oppression at home and provided us with some of the greatest industries we have to-day and some of our most honourable names. When there was oppression here certain people took themselves, not their assets because they had none, and went and founded our Colonies. If financial oppression continues here, or gets worse, there will not only be an export of capital, but an export of many of our citizens, and they will not be the poor element but the rich men. They may be no loss to the country, but I think the country will suffer greatly if they feel that they prefer to go and live abroad.
I do not think that many people, especially hon. Members on the other side of the Committee, realise what a great asset the financial centre of London is to this country. The shipping trade just now is in strong competition with the foreigners. The banks in the same way are in strong competition with American and French banks. If there is the slightest distrust of our credit or the slightest dislike of sending funds here
and using London as a great financial centre, irretrievable damage is done to this country. No one would challenge the statement of the Chancellor of the Exchequer that to encourage the spirit of confidence and enterprise it was right that so far as was humanly possible the people should know the probable full extent of their tax burden in the immediately ensuing year. But the people do not know it now. They are unable to compute the sums that they will have to pay. We all realise, after the answer given yesterday to an hon. Member, that the authorities have failed after three years to devise a scheme of taxation that can be understood.
A few years ago when the Income Tax was sixpence in the pound people did not mind, but to-day no one can understand the Income Tax forms, and they have to employ professional people to provide an explanation. So intricate is the system of taxation that expert accountants are lured away from the Inland Revenue at high salaries to explain the methods under which the Board of Inland Revenue works. No one believes that the Chancellor of the Exchequer or the Treasury or the Board of Inland Revenue intentionally cheats the poor taxpayer, but they are open to the criticism of obtaining money under false pretences when they send out forms that the taxpayer cannot understand, and when it is necessary to employ people to explain them.
For many years the firm with which I am connected had no professional audit. The thing was simple then, merely a question of addition and subtraction, but when the taxes became extremely heavy and the intricacies so great that we could not understand them, for the first time we employed a professional man to help us. The result was extraordinarily satisfactory. We found that for several years we had been paying far more than we ought to have paid. An honest Government such as ours promptly repaid us. But that is not right. It hardly seems possible that officials should not be able to explain clearly what the taxpayer has to pay and how the taxpayer should have kept his accounts in the past. I would like to hear from the Chancellor of the Exchequer what are the great difficulties that have prevented the Committee which
has sat for three years from arriving at some simple story that can be understood. This extra sixpence of Income Tax falls on comparatively few people. Not all of them are wildly extravagant, or useless to the nation, but are people whom it would be a great loss to lose.

Mr. P. SNOWDEN: I appreciate the speech of the hon. Gentleman who has just spoken. It is a most agreeable change to find ourselves discussing this important matter in a serene atmosphere. I appreciate as much as any hon. Member on the other side of the Committee the importance of this question, and I find myself in considerable agreement with some of the arguments which have been advanced in the course of the debate. The hon. Member for Westmorland (Mr. O. Stanley) referred to a remark which I made, I believe in my Budget statement, about the psychological effect of increased taxation. There can be no doubt about that effect. There seems to be an assumption on the opposite side of the Committee that we take delight in imposing new taxation. I believe that my predecessor in office has said more than once, in the course of the Budget debates, that this is a penal charge in the imposition of which I have taken an almost fiendish delight. I want to assure hon. Members opposite that nothing could be further from the truth. I cannot imagine any Chancellor of the Exchequer taking a delight in putting on new taxes. A Chancellor's task at all times is very difficult. If he happens to be in a position to reduce taxation, he may please the people who are the recipients of his bounty, but he certainly gives dissatisfaction to those who do not benefit.
I have been compelled to increase taxation this year under the dire necessity of meeting expenditure which has been incurred either by this Parliament or by the preceding Parliament, and I have done it in a way in which I believe the least injury will be inflicted. I have never believed that the mere imposition of taxation in itself is a desirable thing. The hon. Member for Westmorland gave expression to sentiments which I have repeated time after time during Budget debates. No one has denounced more strongly than I have the mere imposition of taxation in order to spend money on wasteful or unremunerative objects. I agree with what the hon. Member said
—that we must judge taxation and increased taxation by the purposes to which it is to be applied. We must convince the people who have to pay the taxes that the purposes are not merely necessary, but desirable. Taxation is not justified when it is wasteful and unremunerative.
The hon. Member for Westmorland repeatedly addressed to me in the course of his speech a question as to when I would consider that the limits of taxation had been reached. It is obviously impossible to give an answer in categorical terms to a question of that kind. I remember Budget debates in this House before the War when the Conservative party leaders, then in Opposition, urged that the limits of taxation had been reached with an Income Tax of 9d. and 1s. in the £. The limits of national taxation obviously must be determined by the needs of the National Exchequer or, in other words, by the expenditure of which Parliament has approved. The illustration which was given by another speaker as to what would be the effect of a tax of 19s. 6d. in the £ on saving and energy is, of course, reducing the argument to an absurdity, because I am sure that nobody would work hard to earn £1 if he thought that the State was going to take 19s. 6d. of it. I wish to put the matter in rather more reasonable terms, and I wonder if the Committee will bear with me while I illustrate this argument from my own experience of practical affairs. In the days when I earned an honest living by honest work, I had a certain expenditure to meet, and, therefore, I made an income which, after the deduction of taxation, was sufficient to meet that expenditure. If taxation went up or if my expenditure went up, then I undertook more literary commissions and worked harder in order to meet the increased taxation or the increased expenditure. I think a great many people are in the same position. I do not want to deny, and I have never denied, that there is a limit to taxation, but I believe that that limit can only be determined in relation to the needs of the State.
The right hon. Gentleman the Member for Epping (Mr. Churchill) gave expression to economic principles to which I
think nobody could take exception. I should be in a much more fortunate position if he had put those principles into practice when he was in charge of the national finances. I do not wish in the least to deny whatever share of responsibility we may have for the increased taxation which has been necessary, but the fact is that a great amount of the taxation, by far the greater amount of the taxation which I have found it necessary to impose, is due to the deficit and to the financial position generally which was left to me by the right hon. Gentleman. I do not want to go into details about that matter. We have threshed it out across the Floor over and over again. Nevertheless, I must say this. The right hon. Gentleman said that he had struggled for years to avoid the need for reimposing the 6d. in the £ on the Income Tax. But he did so by methods the consequences of which are now coming home to roost, and I have very often regretted that the right hon. Gentleman did not remain in office sufficiently long to have to deal with the financial situation which he created.
He said that there was, of course, a fundamental difference between our views of the true methods of taxation and those of hon. Members opposite. He said that in seeking to impose this additional Income Tax I have been guided by no sound canons of taxation. I am afraid that the right hon. Gentleman is not very well acquainted with the classical canons of taxation laid down by Adam Smith more than a century ago which have been accepted as orthodox by every economist of our time. One principle of those canons is that taxation ought to be levied in accordance with the ability to pay. We have put this point before the House of Commons very often, but I may be pardoned if I repeat it. Taxation, in spite of the heavy taxation of the rich, is not generally levied in accordance with ability to pay. I admit that at once. If that were the only test, the poorer classes of the community, those who pay taxation through indirect taxes, would be relieved of a considerable part of the taxes which they now pay, and correspondingly increased burdens would be put on the wealthier sections of the community. To take 6d. or 1s. from a man with an income of £2 or £3 a week is a very different matter from taking £500 or £1,000
of additional taxation from a person who has an income of £10,000 or £20,000 or £100,000 a year. That increase in taxation may have some of the indirect consequences in regard to saving and the like, to which the hon. Member for Westmorland referred, but at any rate such an increase upon such a large income will not deprive that person of any reasonable comfort or necessity. That cannot be said in regard to the taxation which is imposed on the poorer part of the community.
I believe that I mentioned in the course of one of our earlier debates on the Budget proposals that something like four-fifths of the Customs and Excise Duties are paid by the wage-earning and the lower middle classes. That amounts to more than £200,000,000 a year, a sum which is nearly equal to the yield of the Income Tax. This has a double bearing, and it touches another point made by the hon. Member for Westmorland. We have to raise £355,000,000 a year for the Debt services and, assuming that the whole Debt is held internally, as of course by far the larger part is—I suppose the amount held abroad is a relatively small proportion—that payment is practically equal to the yield of the Income Tax, the Surtax, and the Death Duties. Let us assume for a moment—it is not so in all cases—that the people who hold War Debt are people who pay Income Tax and Surtax and Death Duties, then that sum of £355,000,000 which they pay goes back to them in interest upon their own holdings in War Debt and, therefore, in a sense, it is taken out of one pocket and put back into another. But this cannot be said of taxation which is paid in Customs and Excise Duties.
That is the fundamental difference between ourselves and the party opposite. With increasing emphasis, the right hon. Gentleman my predecessor has in the last 12 months been advocating indirect taxation in preference to direct taxation. The right hon. Gentleman has not always held those views. If he held them 12 months ago, I should like to ask him why he abolished the Tea Duty, and thereby relieved indirect taxation by something like £6,000,000 a year? It is a mistake, too, I think, to assume that direct taxes are a burden on industry and that indirect taxes are not such a burden. My own view is, and I think a
great majority of traders will agree with me, that indirect taxes are a heavier and more direct burden on industry and do more harm to industry than an addition to the Income Tax which would give an equal yield. I cannot, of course, say this in regard to the liquor and tobacco taxes, which I have always put in a special category. If we carried out the suggestion which has been made by the right hon. Gentleman during the last few weeks on several occasions, and stopped this movement that has been going on for the last 50 years to raise a larger proportion of taxation by direct taxes and correspondingly less by indirect taxes; if we reversed that, and ceased to impose additional direct taxation and raised any revenue that might be necessary by means of indirect taxation, do hon. Members possibly maintain for a moment that this would not be a heavy burden on industry?
The right hon. Gentleman has altered his views very radically during the last year or two if he would not agree that an indirect tax, a tax based upon commodities, takes out of the pockets of the taxpayer more, and imposes a burden upon the consumer, very much higher than the revenue that it brings into the Exchequer. I had some very remarkable figures given to me a week or two ago by an importer of an article which is taxed. He gave me the minutest details of the whole transaction. He gave me the price of the article in America, and the price that was paid by the purchaser in this country after the duty had been paid, after the transport charges had been paid, after allowance had been made for the insurance and the profits to various people through whose hands the article went before it reached the purchaser, and the price was more than double the price at which it had originally been bought. Indirect taxation must have this evil result among many other evil results, that it reduces the purchasing power of the people.

Sir DENNIS HERBERT: Will the right hon. Gentleman tell us what the article was?

Mr. SNOWDEN: No.

Mr. BRACKEN: Would the right hon. Gentleman hold that view if the article were a foreign-made article providing no employment here?

9.0 p.m.

Mr. SNOWDEN: I am not going to enter into an argument which involves King Charles' head. Nobody who knows anything about it, and least of all my predecessor in office, will deny that if you put a tax upon an article you raise the price, not merely by the amount of the duty, but by the profit which has been put upon the article in its various stages. I well remember the right hon. Gentleman saying, when he imposed the Silk Duty, that he expected that the consumers would pay; and in the following year, when he was giving in the Budget speech the effect of the taxation, he said that there had not been an increase in the price, but that no doubt the duty had intercepted a fall in price. However, I need not argue that, because the matter is beyond all argument. The point I made is that it is a mistake for the party opposite to maintain that direct taxation is a burden on industry, whereas indirect taxation is no burden at all. The opinion of the Colwyn Committee with regard to the effect of Income Tax upon industry has often been quoted in the House.
I made a few rough notes of the speeches of hon. Members who preceded me, and I think that I have dealt with most of them; I have tried to deal with them in the spirit in which the speeches were delivered. I will conclude with what I said at the beginning of my remarks, that I am imposing this taxation this year under necessity. I do not contend for a single moment that it is going to have a stimulating effect upon industry in the present state of industry, but I maintain that the means by which I am raising the revenue which is absolutely necessary is, taking everything into consideration, certainly the least injurious. I dealt with the point of the hon. Member for Westmorland in regard to the future of taxation, and I can only repeat what I said then, that it is impossible to say what would happen. I repeat a statement which I have made more than once in the last year or two, that at a time like this the available resources of the nation should be directed to the encouragement of industry. We do not abate one item in our programme of social reform, but the carrying out of that programme must be determined by the circumstances. What I want to do is to get industry going again. I want
to get industry making big profits, and then increased taxation would not be felt so much by them.

Mr. A. M. SAMUEL: They would be further taxed as "the idle rich."

Mr. SNOWDEN: What I said just now is in words which are almost identical with those in a memorandum issued by the Federation of British Industries a few weeks ago in which they point out that it is only by increasing the income of the country that we can provide the means of revenue for the social reforms which are being undertaken. I have dealt fairly, I think, with the arguments which have been advanced, and, as we have got to some understanding as to how far we are to get to-night, I hope the further discussion on this particular Amendment will not be unduly protracted.

Mr. SAMUEL SAMUEL: I wish to emphasise what has been said already in reference to the effect which this taxation is likely to have upon the industry and the prosperity of the country. There is an old saying, which no doubt everybody has heard, that money begets money; but this country is being slowly but surely bled to death by high taxation. We have gigantic Death Duties and very heavy taxation on incomes, and I would ask the Chancellor of the Exchequer to have an audit made to ascertain how long it will be before the surplus revenue or, rather, the accumulated mass of money there is in this country, will be exhausted. It would only be a matter of actuarial calculation to arrive at the answer. Under present discouragements it is utterly impossible for anybody ever again to accumulate money. Large incomes are taxed to the maximum. In the case of large fortunes, Death Duties claim 50 per cent. for the State, and 50 per cent. is retained by the relatives of the man who dies. Take the case of a man who leaves £1,000,000. That man would have had an income of £50,000, he would have been a very wealthy man. Out of that £50,000, however, the Government would to-day take £26,000 and leave him with £24,000—of course a very handsome income; and when the man died the Government would take from the estate £400,000.

The CHAIRMAN: We are not dealing with Death Duties at this moment. We are dealing with Income Tax.

Mr. SAMUEL: I was only pointing out the necessity for an actuarial calculation to ascertain how long it will be before we have exhausted the funds at the disposal of wealthy people from which the Government derives the large sums it receives in Income Tax. When the Chancellor is making up his Budget, when the various Departments which spend the money of the taxpayer bring their estimates to him, I ask the Chancellor to consider how he can get anything like the income which he has at the present time from the remains of fortunes which have been dissipated by the extravagance of the Government. [Laughter.] It is easy to laugh, but the Government ought to take heed of this warning in considering the interests of the nation, which, after all, are the interests of the working class. Money has been dissipated by extravagance, and as a nation we must see how we are to live in the future. The Chancellor of the Exchequer and the Treasury ought to remember that this "Rake's Progress" cannot go on for ever. It will be the duty of this Government, indeed, of any Government, to keep a very strong hand on the spending Departments, because while they spend the money we have to provide it, and if the task of finding the money exhausts the resources of the country we prevent that revival of industry upon which we so much depend.
We have, unfortunately, reached the stage where, owing to the extravagance of the Departments, unemployment is becoming greater and greater. We have to provide for unemployment, and with the wastage of the capital of the country which is going on we cannot make provision beyond a certain point. The only way in which the country can get the necessary revenue for this purpose is through an improvement in industry and in commerce. I do not wish to detain the Committee, but I felt constrained to call the attention of the Government to the grave danger in which our industries are as the result of the extravagance on the part of the Government Departments not only under the régime of this Government but previously.

Mr. TINKER: While listening to those who have been talking about dissipation and extravagance I have been wondering how they would raise the money necessary to meet the expenditure of the
country. [HON. MEMBERS: "Speak up!"] An hon. Member opposite spoke about the addition of 6d. to the Income Tax raising nearly £30,000,000, and I was asking how otherwise hon. Members would have procured the money? No one has yet put forward any suggestion. If the burden has to be borne, where else could the money be found? The burden has to be placed on somebody's shoulders. The expenditure of the country must be met. Hon. Members sitting on this side of the House agree with the methods which have been adopted by the Chancellor of the Exchequer to find the money, and the right hon. Gentleman has adopted the only way in which the money could be obtained effectively. Hon. Members opposite have argued that the Government have spent money extravagantly. Do hon. Members opposite use that argument in regard to the great advantages which are being enjoyed by the unemployed, or in regard to the money which has been spent in providing widows' pensions? The Chancellor of the Exchequer has had to find the money for these objects by additional expenditure. Is it the opinion of hon. Members opposite that we have been giving too great benefits to the unemployed and to the widows of this country? If that is their view, they had better face the issue and tell us plainly what they mean. If hon. Members opposite agree with us that the unemployed and the widows should be treated as generously as possible, then they must admit that the only way to find the necessary money is by higher taxation. All this talk about driving capital out of the country does not trouble hon. Members on this side very much. [HON. MEMBERS: "No."] In times gone by it suited wealthy people who support hon. Members opposite to invest their money overseas, and no question of patriotism was raised at that time. Large sums of money were invested in India and China—

The CHAIRMAN: Perhaps the hon. Member will address his remarks to me.

Mr. TINKER: One is inclined, at times like this, to get rather warm, and speak directly to hon. Members opposite. That is a habit we have, and I agree that it is not in keeping with the Rules of the House. I will, therefore, address my remarks to you, Mr. Chairman, and through
you I hope they will get to hon. Members on the other side of the House. The point I was dealing with was that in the past hon. Members opposite, and wealthy people, did not hesitate about investing their money overseas and no question of patriotism was raised at that time. The hon. Member for the City of London (Mr. Grenfell) argued that if the burden of taxation became too great for the wealthy to bear patriotism would go by the board, and they would invest their money abroad.

Mr. S. SAMUEL: He never said that.

Mr. TINKER: I do not want the Chancellor of the Exchequer to be upset by any argument of that kind, and I want the right hon. Gentleman to realise that on this occasion he has pleased hon. Members on this side of the House by the manner in which he has dealt with taxation. When the other side get into power there is no question as to where they will place the burden of taxation. In 1923 the then Chancellor of the Exchequer remitted 1s. from the Income Tax, and in 1925 he remitted another 6d. On this occasion we want the money, and it must be placed on the broad shoulders of those who can afford to pay the Income Tax. If the time comes when those people cannot bear the burden of taxation any longer then we shall have to try some other method. By that time the money will have been distributed more evenly in the country, but until that time arrives I hope the Chancellor of the Exchequer will proceed on the lines which he has adopted in this Budget by direct taxation in the shape of the Income Tax, the Super-tax and the Death Duties.

Sir GERALD HURST: I support this Amendment inasmuch as I represent a district which lives by trade, and in my submission the proposal to increase the Income Tax by 6d. is not only dangerous to trade, but it is totally unjustified by the conditions under which we are living to-day. The Chancellor of the Exchequer addressed the whole of his argument to the issue as to whether the class that was going to pay the extra Income Tax was the class best able to bear the burden of taxation. That, however, is not the real issue raised by this Amendment. The real issue is whether or not this increase of taxation is necessary. Taxation is, ipso facto, a bad thing, and,
unless it is absolutely necessary there can be no virtue in saying that we are putting it on the people who are best able to bear the burden.
The Chancellor of the Exchequer has to satisfy the Committee that this increase in taxation is necessary. At the present time, nobody who knows the condition of our industrial districts can help realising that what is wanted as much as anything else is the provision of ample capital. A few weeks ago I happened to be in the corner of the Colne Valley Division which looks down on the great plain of South Lancashire between Oldham and Manchester. It is an area covered with mills, and at the present time there are scarcely any mills at work there. The whole district is absolutely desolate, and it is a necessitous area if ever there was a necessitous and destitute area.
One way in which industry can be partially restored there and employment found for those who are out of work is by refitting and replacing the old-fashioned machinery in a great many of the mills in order to make them better able to compete with the newly-equipped and better equipped mills of their Continental competitors. Another and more important way to deal with that problem is by providing new industries, because there is no doubt that, at the present time, the Lancashire cotton trade has to support a greater population than the industry can bear, and the starting of new industries to provide more employment is the only way out of the difficulty. The only way in which we can find capital to replace the old machinery and to finance new industry is to utilise that margin of income which remains after a man has met his ordinary expenditure and his ordinary taxation. The real question which the Committee has to ask is whether this margin of income is best devoted to re-equipping industry, starting new trades and adding to the reserves of our trade, and whether that is not the better way of utilising the margin which is now diverted by taxation into unproductive expenditure?
The last speaker has very truly said that we must see to what purpose the money is to be applied. Nobody can say that the additional need for taxation which has been created by the Socialist Government has in any way been productive
expenditure. We know quite well why these new taxes are required. There is £14,000,000 required for increased unemployment pay, £4,000,000 to enable persons to draw unemployment benefit even if they cannot show that they are genuinely seeking work, and £5,000,000 to meet the cost of the new widows' and orphans' pensions which are given to people quite regardless of whether they need them or not. All this new source of taxation is, no doubt, very welcome to the recipients of these doles and bounties, but nobody can suggest that it is reproductive in the sense of giving life-blood to industry. It is a diversion of money from trade and industry to outlets of national expenditure for which there is no national return whatever. At the present time we need rigorous economy. If we have that, there is no need for any increased taxation.
The Chancellor of the Exchequer often seeks to place our party in a dilemma by asking to which, if any, expenditure we object, because if we do not object to any we cannot logically reduce the taxes. I suggest the answer is that we believe that a great deal of this adventure in expenditure on so-called social services is unwarranted by the conditions of the times in which we are now living. The Prime Minister has deprecated a great many of the adventures in the nature of social services upon which his party suggests that the Government should embark. Those which he does not like he calls the "flashy futilities of Socialism in our time," and those which he likes he calls "social services." They are all really in the same category, and none of them can the country afford at the present time. The hon. Member who spoke last asked how otherwise could we provide for this new expenditure if we did not do it by 6d. on the Income Tax? As I understand it, this increase of Income Tax brings in a little more than £20,000,000. At the present time we have a revenue of £14,500,000 from the McKenna and Safeguarding Duties. If we doubled those duties, we should have £29,000,000, and that is the answer to the question. The view which is taken by people most concerned in industry is that that is a much better way of finding money. Hon. Members will have seen with pleasure the decision of a very large majority of the Manchester Chamber
of Commerce on this subject. That is the conclusive answer to the question which the hon. Member asks. That is the way in which we propose to find the money.

Mr. TINKER: Would the hon. and learned Gentleman then place the tax on the shoulders of the consumer?

Sir G. HURST: The hon. Member knows quite well the consumer does not always pay. In the case of fully-manufactured foreign luxuries, it really does not matter if he does, because if he cares to buy such foreign articles he can very well afford to pay. I should like to point out what is really an illusion in the speech of the Chancellor of the Exchequer. He asked how could Income Taxpayers complain, seeing that a great many of them had lent money to the Government during the War and got interest on their War Loan. What they paid out in Income Tax they got back again in interest on War Loan. That means that people have to be content to have lent their money to the State for nothing. If that argument were carried to its logical conclusion, it could justify repudiation, because it would mean that the State, having obtained loans, would be justified in giving no interest on them. That is an absolutely untenable argument.
Quite apart from the effects of this increased Income Tax upon industry, I suggest that it is a bad thing to have brought it forward and supported it by the dialectics with which it is supported not only in this House but in the country. It is supported on a plea founded entirely on an illusion—that it is a bad thing in this country for a man to become rich, and that a man who obtains wealth for himself is doing an injury to the poor. That is preached up and down the country, and it really represents the argument upon which this increase in Income Tax has been justified in this House. There are no doubt bad types of rich men. It may, perhaps, happen that a man who acquires wealth in business may be selfish, and be a man who grinds the faces of the poor. There may be such types, but I would remind hon. Members that where men have acquired wealth through industry, they have not only acquired wealth for themselves, but for the people whom they employ.
Up and down Yorkshire and Lancashire you may find hard types of wealthy employers, but the fact remains that it is they who have provided means of livelihood for a large portion of the working classes. Hon. Members must not forget that the desire to get on in the world may not be the highest motive, but it is certainly one which has made for the good of the people. The hope of the industrial world is that self-help should not die out, and that a man should still wish to get on in the world, because by getting on he will provide opportunities of well-being for those around him. That is a commonplace which hon. Members opposite are apt to forget. If you destroy the motive for getting on by penalising a man because he has gained a certain amount of capital, you are really destroying the root of those activities and ambitions which have led to all progress in industrial England. Quite apart from the immediate effects of high taxes upon industry, I suggest that these arguments which have been put forward are detrimental to the best interests of the whole country.

Mr. J. JONES: To those of us who are not experts in finance, it has been very interesting to listen to some of the speeches we have heard this afternoon. The main burden of the speeches has been "Pity the poor rich." All these burdens are placed on them, and yet they still manage to escape taxation. One hon. Member representing the greatest financial centre in the world told us that if we dared to go so far we must not go any further, and that in certain eventualities they would take their capital abroad. They mean by "capital" simply the amount of money they may possess in the banks, but really the capital of this country is not the amount of money in the banks but the material, the land, the mineral wealth, the means of transport, all the amenities of living and the brain and sinews of the people. They are only gamblers in these things, which are the real capital, and they come to us with a lordly manner, with their pince-nez on and their big banking accounts, and talk to us as though they were the only people who counted—they are the only pebbles on the beach. But the ordinary workman in this country has done far more
than they have to make the country what it is. [Interruption.] I am only answering the so-called arguments of hon. Members opposite.
I am not well up in figures; I only know the figures in the streets. The figures in the books do not appeal to me very much, because anyone who is a good figure-twister can make them mean what he likes. In this case the question is, who has got to pay? What form of taxation are we to adopt, whether direct upon the people who have got the money, or indirect upon the people who have not? The hon. and learned Member who has just addressed the House—I wish I had learned so much and knew so little—has just informed us that we cannot afford to tax the people who have got it. The obvious alternative is that you must tax the people who have not got it—you must tax their brains and their bodies, you must tax their boots and their clothes. "Tax my father and my mother, my sister and my brother, but for God's sake don't tax me." I do not always agree with the Chancellor of the Exchequer. In some things he differs from me, but all great minds do not always think alike. I agree with him, however, in this, that if you want any money you have got to go where it is. It is no good coming round to my house after it, when we have honourable millionaires sitting on the benches opposite. They object to paying another sixpence in the pound, but they will pay sixpence to-night for a cigar[Interruption]—putting it at the lowest possible price. They do not object to paying guineas for a dinner. I should have to look twice at a guinea before I could afford it for a dinner.
Always, when it is a question of wanting money for national purposes, they say it cannot be done, that you are ruining the country and the people. Who are being ruined? They are the people who every year on the average increase their income by £100,000,000 per annum. Who is going to have to pay on the basis of this Budget? Nobody with an income of less than £2,000 will pay it a penny piece more than they paid before. Who is going to pay? The handful of people in this country who have got their hands round the necks of everybody else. They talk about transmitting their capital abroad. Lancashire has been mentioned by the hon. and learned Member. He
talks about the capital in Lancashire. What has been the main cause of the Lancashire situation? Lack of capital? As a matter of fact, the Lancashire cotton industry has been the most over-capitalised industry in Great Britain. It is not for lack of money, but because they found it easier and more profitable to transfer their capital, as they call it, to other countries where labour was cheaper and profits were greater. Therefore, we found Japan, and China, and India, where labour is down to practically next to nothing as compared with Lancashire. All these places are being financed by the very people who are talking about the collapse of Lancashire in industry. How in the name of all that is reasonable can you compete against labour under these conditions? People talk about Imperial Free Trade. Are we going to bring India within the Empire from the standpoint of competition in the cotton industry? You know as well as I do that the Lancashire cotton operatives could not possibly compete against Indian labour in the production of cotton goods so far as the Indian market is concerned.
What is the good of talking to us like this? I am only a labourer. I do not pretend to be an economist, except so far as I have had to practise economy. All the economics that I have ever learned has been the economics of having to tighten my belt and look for a job in London, and that has taught me more economics than hon. Members opposite ever knew anything about—the economics of how to live within your means. This country has the means if it has the will. All that we are doing now is just asking you for a little to save you from taking the lot. We say the time has arrived when taxation must be based on this principle: "Those who have got it will have to dub up." It is the truth now, as it always has been as far as I have been able to understand it, that the people who pay most taxation are the people who have the least to pay it with. Consequently, the screams from the other side do not upset me in the slightest degree. From the way in which millionaires opposite have been shouting, one would think that they were not going to the Derby to-morrow, just to show how economical they are; but to-morrow this House will be half deserted by gentleman who cannot afford to pay their Income Tax; and when they have
exhausted the possibilities of luxury, they will come back and talk to us about economy. [Interruption.] I shall not be there. As far as I am concerned, I would rather go and see a football match.
I want the Committee to remember that, after all, we are not so foolish as we look. When we are discussing matters of taxation, we know just as much as you do about them. We know economics as well as you do. We know that all wealth is the result of human energy applied to the raw materials provided by God and Nature for the use of mankind. That wealth is not the product of the people at the top who think themselves clever; it is the result of the human activities and social abilities of all the people working for a common end; and we claim that that wealth which is the result of the activities of all the people is a social product which must be socially controlled in the interests of all the people. At the present time all the chance that we have is, by Budgets such as this, to divert back to the stream that wealth which up to now has been ostracised into the hands of private individuals under their own control. [Interruption.] It is perfectly true to say that it has been ostracised. Some of those who have been talking have not been ostracised; they have been looked upon as products of the community, of which they do not form a part. They are parasites upon the back of industry, yet they think themselves absolutely indispensable. Nobody is indispensable. We say that here we are adopting the principle of taxing those who can afford to pay. Can anyone object to that? I would like you to come down to my constituency and talk to the people there. I would like some of those hon. Members opposite who have spoken to come and face an audience of dock labourers. They are not people who would attack you; they would listen to you. I could get young men of 25 or 30 who would beat you in argument on any platform in that constituency, who would show you something about economics, and teach you the facts of the industrial and political situation. Therefore, we are supporting the Chancellor of the Exchequer as far as he goes. Our only regret is that he has not gone far enough.

Mr. HASLAM: My hon. and learned Friend the Member for Moss Side (Sir G. Hurst) showed how this increased burden of direct taxation was going to prevent a very important industrial area in Lancashire from recovering in the way that otherwise it might do. I desire to draw attention to another aspect of heavy direct taxation—to the effect that it would have on British industries abroad. The party opposite have always treated this taxation as if it rested entirely on the individual, and as if it were simply and solely the putting on the individual who had the income the appropriate tax, but the Income Tax, as it is at present applied, is very much more than that. It does not only rest on the individual. The Income Tax, as applied to public companies, falls as a burden not only on the amount which they distribute in dividends to the shareholders, but it rests also on that amount which, as prudent managers, they feel obliged to apply to reserve. I do not suppose there is a single public company which does not place to reserve very considerably larger sums than are allowed by the Income Tax regulations for replacement and the various objects that are mentioned in those regulations.
Mention has been made of English capital going abroad. English capital has gone abroad. It has established industrial works and enterprises in almost every country in the world. I doubt if there is a single country in which British brains and enterprise have not established one form of industry or another. Those industries established overseas provide a very considerable income coming into this country. They have to pay Income Tax not only on the money they transmit here as profits for their shareholders, but they have to pay the same tax on all those profits which they put to reserve for the purpose of expansion and holding their own in the countries in which they are established, and it is a very material point as to how this increase of Income Tax is going to affect them. In practically none of the countries where they are established is there any taxation comparable to that in this country, and the result is that they are bearing a burden which their competitors in this country do not bear. But they have a method of escape. If they are registered in this country, they pay British Income Tax. They can register
themselves in the country in which they are, in which case they would immediately be relieved of British tax. Of course, a company in a foreign country has not only to bear British Income Tax, but the taxes of the country in which it is operating, as is obviously fair and just.
It seems to me that this question should be studied from the point of view of arriving at some idea as to the point up to which they can be taxed before they begin to think of registering themselves outside this country, in which case the Revenue will lose quite a considerable amount. Private individuals who have built up businesses, when they return to England, in many cases take care not to domicile themselves in this country. They take care so to comport themselves and to live that they are not liable to Income Tax. I do not think those who have built up these businesses all over the world can be accused of lack of patriotism. It is a magnificent achievement that Englishmen have gone all over the world and established businesses in almost every country under the sun. It is one of the evils of this system of direct taxation that we may very likely deprive ourselves of the very large income that we are getting from those industries if we drive them to register themselves in a foreign country.

The FINANCIAL SECRETARY to the TREASURY (Mr. Pethick-Lawrence): I rise to make an appeal. I think it is the wish of Members on all sides of the Committee that we should not sit unreasonably late. It is understood that we have still a considerable number of Amendments to cover, and, though I do not complain of the tone or spirit in which the Amendment has been discussed, I hope the Committee will now bring the discussion to a close.

Mr. HAMMERSLEY: One quite appreciates the tone in which the debate has been carried on, and I am sure we should be anxious to expedite the course of business, but this is probably the most important Amendment of the whole Bill, and it seems to me to be asking a little too much to suggest that we should not be given some freedom of discussion on a matter which is of vital importance to the industries of the country. The, Chancellor of the Exchequer in his compendious reply, indicated that the policy
he was pursuing was one that was, in his opinion, going to be to the advantage of the industry of the country. The case for the Government is simple. They say taxation has to be raised because of expenditure caused by the action of previous Parliaments. If this expenditure has to be raised, in their view it can best be raised by taxing that class of the community which can most afford to pay it. They say, further, that this form of direct taxation is of a character which will not hurt industry. It is that statement of defence which I should like to examine. They base their case almost entirely on the Colwyn Report, where it says that direct taxation does not enter into prices. That may be true, but we have to consider from the point of view of industry whether or not direct taxation enters into costs of production. In a competitive trade where your selling price is controlled by outside costs of production, you may not be able to sell in accordance with your costs of production, because you cannot pass the increased costs of production on to your selling price.
Therefore, the result of direct taxation in this case may very well be that prices do not go up; you have not affected the general level of prices, but you have seriously affected the amount of profit that is being made. Competitive trades cannot carry forward their increased overhead costs on to prices, and any policy which this Government puts forward which does in fact increase the costs of production can rightly be condemned. The Government say that this policy does not do that. Let me take the general case of the basic industries. Hon. Members have been sent a pamphlet entitled "An Analysis of Rationalisation," published by the "Times." In that analysis there occur these words:
The three most vital needs of British industry to-day are the elimination of excessive competition by means of amalgamation, the reduction of the burden of debt incurred during the short-lived "boom" and the long years of depression which followed, and the provision of fresh capital for re-planting and reorganisation.
It is this important point of the provision of fresh capital for re-planting and reorganisation to which I wish to draw the attention of the Committee.
The "Analysis" from which I have quoted goes on to say:
These three needs are all mutually interdependent and unless they can be satisfied simultaneously, little progress can be made.
Quite clearly, the effect of very heavy direct taxation, at a time when the industries of the country are depressed is to narrow the field from which new capital can be taken for the essential process of reorganisation which, in the words which I have quoted, is so dependent upon our being able to draw new capital. The effect of this taxation is to prevent that new field of capital being drawn upon, and to prevent the reorganisation of these industries. The Lord Privy Seal is depending upon this new capital coming forward. This taxation, in the special circumstances of the time, is interfering with the work which the Lord Privy Seal still says is necessary in the policy which he is putting forward to deal with unemployment.
Let us take the position of the trade with which I am so closely associated, the Lancashire cotton trade. I am addressing myself to the particular point of whether or not direct taxation is carried forward on to the costs of production. In the Lancashire spinning trade the production is financed in a unique way. They obtain loans, and the loan capital together with the share capital provide the means whereby production is carried on. The loan capital forms a very large proportion of the available capital resources of the company, and those loans are lent to the mills on terms free of Income Tax. They are lent at 4½ per cent. or 5 per cent., free of Income Tax. If the Income Tax goes up, the company has to pay more, because the person who lends the money receives a certain amount of interest free of Income Tax. Therefore, it is quite clear that in that special case, which deals with the largest exporting industry in this country, the amount of Income Tax is directly borne by the industry and, in fact, direct Income Tax is one of the costs of production. In cases where the loans are not lent on terms free of Income Tax, the investor requires to receive a certain net yield and, to the extent that the Income Tax is put up, he has to be offered more advantageous terms.
10.0 p.m.
I believe that if hon. Members will read the Colwyn Report wholly, they will not get the direct statement which is so frequently put forward that direct taxation is not carried forward into the costs of production. The circumstances under which the Colwyn Report was collected, militated against a very accurate analysis of present day circumstances. It should not be forgotten that when that evidence was collected we and other countries had not returned to the gold standard, and we had not arrived at the present circumstances of practically universal depression, when onerous taxation has a much greater effect on the problems of industry than normal taxation in a time of prosperity. The purpose of this direct taxation should be taken into consideration. The hon. Member for Westmorland (Mr. Stanley) pointed out that we ought to bear in mind for what purpose the taxation is to be used. That is true.
As far as I understand it, the Government consider that by direct taxation they can use Income Tax as a means of re-distributing wealth. That is a view that I should like to challenge. In my view, high taxation very frequently destroys wealth. You can have millions of capital sunk in mills, machinery and so forth, and if by means of taxation those industries are not prosperous, then the whole of that capital expenditure becomes valueless, and instead of assisting to produce wealth you have destroyed that wealth. It is the last 25 per cent. of production in the basic trades of the world that makes the previous 75 per cent. profitable or not profitable. Therefore it follows that if we are going to get out of our present depressed condition, we must pursue a policy which will enable us to augment the existing amount of production, and we have to do that by cheaper costs instead of endeavouring to re-distribute wealth by means of high taxation. I believe the proper policy to be followed is to re-distribute wealth through the lower prices of commodities, and we can get lower prices of commodities by the economies that come through mass production and through higher

wages. If you will do what the Chancellor of the Exchequer said he wanted to do, and that was to put the whole of his financial machinery at the back of the producers of the country, you can arrive at a state of affairs in which commodities can be continuously cheapened, and you ought to be able to provide increased employment at higher wages. That would be the best way of redistributing wealth.

Industrialists feel that what ought to happen in the present depressed condition of trade is that, as far as possible, the burden of their costs of production should be lightened. If, for example, it could be considered practicable to move the existing burden of taxation from direct taxation on to the taxation of imported manufactured goods and goods of a luxury character, to that extent you would lower the costs of production by reducing your taxation on the manufacturer and the benefit would be perceived throughout the whole community. It is not the case that putting an indirect tax on a luxury article is the same kind of tax as putting an Excise Tax on tea, coffee, or cocoa. The Chancellor of the Exchequer tried to twit my right hon. Friend the Member for Epping (Mr. Churchill) with having suggested in his speeches that it was desirable to tax manufactured imported goods, and that at the same time he had pursued a policy, when Chancellor of the Exchequer, of removing the Excise Tax upon tea; but these are kinds of indirect taxation of a very different character. From the point of view of the producer, if you could tax the manufactured commodities which come into direct competition with the goods which you make in order to provide employment for your people, and so build up the total volume of production, in that way you could re-distribute wealth in the best possible fashion, through lower prices of commodities and through higher wages.

Question put, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 283; Noes, 145.

Division No. 332.]
AYES.
[10.10 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Aitchison, Rt. Hon. Craigie M.
Arnott, John


Adamson, W. M. (Staff., Cannock)
Alpass, J. H.
Aske, Sir Robert


Addison, Rt. Hon. Dr. Christopher
Ammon, Charles George
Ayles, Walter


Baker, John (Wolverhampton, Bilston)
Hayday, Arthur
Nathan, Major H. L.


Baldwin, Oliver (Dudley)
Henderson, Arthur, Junr, (Cardiff, S.)
Naylor, T. E.


Barnes, Alfred John
Henderson, Thomas (Glasgow)
Newman, Sir R. H. S. D. L. (Exeter)


Batey, Joseph
Henderson, W. W. (Middx., Enfield)
Oldfield, J. R.


Beckett, John (Camberwell, Peckham)
Harriotts, J.
Oliver, George Harold (Ilkeston)


Bellamy, Albert
Hirst, G. H. (York W. R. Wentworth)
Oliver, P. M. (Man., Blackley)


Bennett, Capt. Sir E. N. (Cardiff C.)
Hirst, W. (Bradford, South)
Owen, Major G. (Carnarvon)


Benson, G.
Hoffman, P. C.
Owen, H. F. (Hereford)


Bentham, Dr. Ethel
Hopkin, Daniel
Palin, John Henry


Bevan, Aneurin (Ebbw Vale)
Horrabin, J. F.
Palmer, E. T.


Birkett, W. Norman
Hudson, James H. (Huddersfield)
Perry, S. F.


Bowen, J. W.
Hunter, Dr. Joseph
Peters, Dr. Sidney John


Broad, Francis Alfred
Hutchison, Maj.-Gen. Sir R.
Pethick-Lawrence, F. W.


Brockway, A. Fenner
Isaacs, George
Picton-Turbervill, Edith


Bromfield, William
Jenkins, W. (Glamorgan, Neath)
Pole, Major D. G.


Bromley, J.
John, William (Rhondda, West)
Potts, John S.


Brooke, W.
Johnston, Thomas
Price, M. P.


Brothers, M.
Jones, F. Llewellyn- (Flint)
Pybus, Percy John


Brown, C. W. E. (Notts, Mansfield)
Jones, Henry Haydn (Merioneth)
Quibell, D. J. K.


Brown, Ernest (Leith)
Jones, J. J. (West Ham, Silvertown)
Ramsay, T. B. Wilson


Brown, Rt. Hon. J. (South Ayrshire)
Jones, Rt. Hon Leif (Camborne)
Richards, R.


Buchanan, G.
Jones, Morgan (Caerphilly)
Richardson, R. (Houghton-le-Spring)


Burgess, F. G.
Jones, T. I. Mardy (Pontypridd)
Riley, Ben (Dewsbury)


Burgin, Dr. E. L.
Jowett, Rt. Hon. F. W.
Riley, F. F. (Stockton-on-Tees)


Buxton, C. R. (Yorks, W. R. Elland)
Jowitt, Rt. Hon. Sir W. A.
Ritson, J.


Caine, Derwent Hall-
Kedward, R. M. (Kent, Ashford)
Romeril, H. G.


Cameron, A. G.
Kennedy, Thomas
Rosbotham, D. S. T.


Cape, Thomas
Kinley, J.
Rowson, Guy


Carter, W. (St. Pancras, S. W.)
Kirkwood, D.
Russell, Richard John (Eddisbury)


Charieton, H. C.
Lang, Gordon
Salter, Dr. Alfred


Chater, Daniel
Lathan, G.
Samuel, Rt. Hon. Sir H. (Darwen)


Church, Major A. G.
Law, Albert (Bolton)
Samuel, H. W. (Swansea, West)


Clarke, J. S.
Law, A. (Rosendale)
Sanders, W. S.


Cluse, W. S.
Lawrence, Susan
Sandham, E.


Clynes, Rt. Hon. John R.
Lawson, John James
Sawyer, G. F.


Cocks, Frederick Seymour
Lawther, W. (Barnard Castle)
Scott, James


Collins, Sir Godfrey (Greenock)
Leach, W.
Scrymgeour, E.


Compton, Joseph
Lee, Frank (Derby, N. E.)
Scurr, John


Cove, William G.
Lee, Jennie (Lanark, Northern)
Sexton, James


Cowan, D. M.
Lees, J.
Shepherd, Arthur Lewis


Daggar, George
Lewis, T. (Southampton)
Sherwood, G. H.


Dallas, George
Lindley, Fred W.
Shield, George William


Davies, E. C. (Montgomery)
Lloyd, C. Ellis
Shillaker, J. F.


Davies, Rhys John (Westhoughton)
Logan, David Gilbert
Shinwell, E.


Denman, Hon. R. D.
Longbottom, A. W.
Short, Alfred (Wednesbury)


Dickson, T.
Longden, F.
Simmons, C. J.


Dudgeon, Major C. R.
Lovat-Fraser, J. A.
Simon, E. D. (Manch'ter, Withington)


Dukes, C.
Lowth, Thomas
Sinclair, Sir A. (Caithness)


Duncan, Charles
Lunn, William
Sinkinson, George


Ede, James Chuter
Macdonald, Gordon (Ince)
Sitch, Charles H.


Edmunds, J. E.
MacDonald, Malcolm (Bassetlaw)
Smith, Alfred (Sunderland)


Edwards, C. (Monmouth, Bedwellty)
Macdonald, Sir M. (Inverness)
Smith, Frank (Nuneaton)


Edwards, E. (Morpeth)
McElwee, A.
Smith, H. B. Lees- (Keighley)


Egan, W. H.
McEntee, V. L.
Smith, Rennie (Penistone)


Elmley, Viscount
McKinlay, A.
Smith, Tom (Pontefract)


Evans, Capt. Ernest (Welsh Univer.)
MacLaren, Andrew
Smith, W. R. (Norwich)


Foot, Isaac
Maclean, Sir Donald (Cornwall, N.)
Snell, Harry


Forgan, Dr. Robert
MacNeill-Weir, L.
Snowden, Rt. Hon. Philip


Freeman, Peter
Macpherson, Rt. Hon. James I.
Snowden, Thomas (Accrington)


Gardner, B. W. (West Ham, Upton)
McShane, John James
Sorensen, R.


Gardner, J. P. (Hammersmith, N.)
Malone, C. L'Estrange (N'thampton)
Stamford, Thomas W.


George, Megan Lloyd (Anglesea)
Mander, Geoffrey le M.
Stephen, Campbell


Gibson, H. M. (Lancs, Mossley)
Mansfield, W.
Stewart, J. (St. Rollox)


Gill, T. H.
March, S.
Strachey, E. J. St. Loe


Gossling, A. G.
Markham, S. F.
Strauss, G. R.


Gould, F.
Marley, J.
Sullivan, J.


Graham D. M. (Lanark, Hamilton)
Mathers, George
Sutton, J. E.


Graham, Rt. Hon. Wm. (Edin., Cent.)
Matters, L. W.
Taylor, R. A. (Lincoln)


Granville, E.
Maxton, James
Thorne, W. (West Ham, Plaistow)


Gray, Milner
Melville, Sir James
Tillett, Ben


Grenfell, D. R. (Glamorgan)
Messer, Fred
Tinker, John Joseph


Griffith, F. Kingsley (Middlesbro' W.)
Middleton, G.
Toole, Joseph


Griffiths, T. (Monmouth, Pontypool)
Mills, J. E.
Tout, W. J.


Groves, Thomas E.
Milner, Major J.
Townend, A. E.


Grundy, Thomas W.
Montague, Frederick
Trevelyan, Rt. Hon. Sir Charles


Hall, F. (York, W. R., Normanton)
Morgan, Dr. H. B.
Turner, B.


Hall, G. H. (Merthyr Tydvil)
Morley, Ralph
Vaughan, D. J.


Hall, Capt. W. P. (Portsmouth, C.)
Morris, Rhys Hopkins
Viant, S. P.


Hamilton, Mary Agnes (Blackburn)
Morris-Jones, Dr. J. H. (Denbigh)
Walkden, A. G.


Hamilton, Sir R. (Orkney & Zetland)
Morrison, Herbert (Hackney, South)
Walker, J.


Harbord, A.
Morrison, Robert C. (Tottenham, N.)
Wallace, H. W.


Hardie, George D.
Mort, D. L.
Wallhead, Richard C.


Harris, Percy A.
Moses, J. J. H.
Walters, Rt. Hon. Sir J. Tudor


Hastings, Dr. Somerville
Muff, G.
Watkins, F. C.


Haycock, A. W.
Muggeridge, H. T.
Watson, W. M. (Dunfermline)




Watts-Morgan, Lt.-Col. D. (Rhondda)
Whiteley, William (Blaydon)
Wilson R. J. (Jarrow)


Wellock, Wilfred
Wilkinson, Ellen C.
Winterton, G. E. (Leicester, Loughb'gh)


Welsh, James (Paisley)
Williams, David (Swansea, East)
Wood, Major McKenzie (Banff)


West, F. R.
Williams, Dr. J. H. (Llanelly)
Wright, W. (Rutherglen)


Westwood, Joseph
Williams, T. (York, Don Valley)
Young, R. S. (Islington, North)


White, H. G.
Wilson, C. H. (Sheffield, Attercliffe)



Whiteley, Wilfrid (Birm., Ladywood)
Wilson, J. (Oldham)
TELLERS FOR THE AYES—




Mr. Allen Parkinson and Mr. Paling.


NOES.


Acland-Troyte, Lieut.-Colonel
Fison, F. G. Clavering
Peaks, Capt. Osbert


Albery, Irving James
Ford, Sir P. J.
Peto, Sir Basil E. (Devon, Barnstaple)


Atkinson, C.
Forestier-Walker, Sir L.
Pownall, Sir Assheton


Baldwin, Rt. Hon. Stanley (Bowdley)
Fremantle, Lieut.-Colonel Francis E.
Ramsbotham, H.


Balfour, Captain H. H. (I. of Thanet)
Gault, Lieut.-Col. Andrew Hamilton
Rawson, Sir Cooper


Balniel, Lord
Gibson, C. G. (Pudsey & Otley)
Reid, David D. (County Down)


Beaumont, M. W.
Graham, Fergus (Cumberland, N.)
Remer, John R.


Betterton, Sir Henry B.
Grattan-Doyle, Sir N.
Reynolds, Col. Sir James


Bevan, S. J. (Holborn)
Greene, W. P. Crawford
Richardson, Sir P. W. (Sur'y, Ch'ts'y)


Bird, Ernest Roy
Grenfell, Edward C. (City of London)
Roberts, Sir Samuel (Ecclesall)


Bourne, Captain Robert Croft.
Gretton, Colonel Rt. Hon. John
Ross, Major Ronald D.


Boyce, H. L.
Gritten, W. G. Howard
Russell, Alexander West (Tynemouth)


Bracken, B.
Hacking, Rt. Hon. Douglas H.
Salmon, Major I.


Brass, Captain Sir William
Hall, Lieut.-Col. Sir F. (Dulwich)
Samuel, A. M. (Surrey, Farnham)


Briscoe, Richard George
Hamilton, Sir George (Ilford)
Samuel, Samuel (W'dsworth, Putney)


Brown, Col. D. C. (N'th'l'd., Hexham)
Hammersley, S. S.
Sandeman, Sir N. Stewart


Bullock, Captain Malcolm
Harvey, Major S. E. (Devon, Totnes)
Sassoon, Rt. Hon. Sir Philip A. G. D.


Butler, R. A.
Haslam, Henry C.
Savery, S. S.


Cadogan, Major Hon. Edward
Henderson, Capt. R. R. (Oxf'd, Henley)
Shepperson, Sir Ernest Whittome


Carver, Major W. H.
Heneage, Lieut.-Colonel Arthur P.
Sinclair, Col. T. (Queen's U., Belfst)


Cautley, Sir Henry S.
Hennessy, Major Sir G. R. J.
Smith, Louis W. (Sheffield, Hallam)


Chapman, Sir S.
Herbert, Sir Dennis (Hertford)
Smith-Carington, Neville W.


Christie, J. A.
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Smithers, Waldron


Churchill, Rt. Hon. Winston Spencer
Hudson, Capt. A. U. M. (Hackney, N.)
Somerville, A. A. (Windsor)


Colfox, Major William Philip
Hurd, Percy A.
Somerville, D. G. (Willesden, East)


Colman, N. C. D.
Hurst, Sir Gerald B.
Southby, Commander A. R. J.


Colville, Major D. J.
Jones, Sir G. W. H. (Stoke New'gton)
Stanley, Maj. Hon. O. (W'morland)


Cranborne, Viscount
Knox, Sir Alfred
Steel-Maitland, Rt. Hon. Sir Arthur


Crichton-Stuart, Lord C.
Lamb, Sir J. Q.
Stewart, W. J. (Belfast South)


Croft, Brigadier-General Sir H.
Lane Fox, Col. Rt. Hon. George R.
Sueter, Rear-Admiral M. F.


Crookshank, Capt. H. C.
Law, Sir Alfred (Derby, High Peak)
Thomas, Major L. B. (King's Norton)


Croom-Johnson, R. P.
Leighton, Major B. E. P.
Titchfield, Major the Marquess of


Culverwell, C. T. (Bristol, West)
Little, Dr. E. Graham
Todd, Capt. A. J.


Cunliffe-Lister, Rt. Hon. Sir Philip
Locker-Lampson, Rt. Hon. Godfrey
Turton, Robert Hugh


Dalkeith, Earl of
Long, Major Eric
Vaughan-Morgan, Sir Kenyon


Davies, Dr. Vernon
Macdonald, Capt. P. D. (I. of W.)
Ward, Lieut.-Col. Sir A. Lambert


Davison, Sir W. H. (Kensington, S.)
MacRobert, Rt. Hon. Alexander M.
Wardlaw-Milne, J. S.


Dixey, A. C.
Maitland, A. (Kent, Faversham)
Waterhouse, Captain Charles


Dixon, Captain Rt. Hon. Herbert
Makins, Brigadier-General E.
Wayland, Sir William A.


Duckworth, G. A. V.
Margesson, Captain H. D.
Wells, Sydney R.


Eden, Captain Anthony
Mason, Colonel Glyn K.
Williams, Charles (Devon, Torquay)


Edmondson, Major A. J.
Mond, Hon. Henry
Wilson, G. H. A. (Cambridge U.)


Elliot, Major Walter E.
Monsell, Eyres, Com. Rt. Hon. Sir B.
Womersley, W. J.


England, Colonel A.
Morrison, W. S. (Glos., Cirencester)
Wood, Rt. Hon. Sir Kingsley


Erskine, Lord (Somerset, Weston-s.-M.)
Nicholson, O. (Westminster)
Worthington-Evans, Rt. Hon. Sir L.


Everard, W. Lindsay
Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)



Falle, Sir Bertram G.
Nield, Rt. Hon. Sir Herbert
TELLERS FOR THE NOES.—


Ferguson, Sir John
O'Connor, T. J.
Sir Frederick Thomson and Captain


Fermoy, Lord
Oman, Sir Charles William C.
Wallace.


Fielden, E. B.
O'Neill, Sir H.

The DEPUTY-CHAIRMAN: I understand that, in view of the wide discussion on the previous Amendment, there is an arrangement that on the subsequent Amendments on the Clause debate shall not be unduly prolonged.

Sir D. HERBERT: I beg to move, in page 5, line 25, to leave out from the word "pound," to the end of the Sub-section.
This is a manuscript Amendment, and, before dealing with it, I should like to have your guidance in the matter. It has been indicated to me that two subsequent Amendments standing in my
name and in the names of my hon. Friend the Member for Lewisham (Sir A. Pownall) and the hon. and gallant Member for Oxford City (Captain Bourne) will be ruled out of order. I do not desire to proceed with this manuscript Amendment if I have an opportunity of raising the point I desire to raise on the two later Amendments, and I should like to ask whether you will be good enough to tell me, if I do not proceed with this manuscript Amendment, that you will call me in respect of the later Amendment. If you do not propose to call me perhaps you will indicate to me why you rule the later Amendments out of order?

The DEPUTY-CHAIRMAN: The first Amendment of the hon. Member is contrary to the Money Resolution and the second Amendment is consequential, and I therefore do not propose to call them.

Sir D. HERBERT: May I put the point to you as to whether your ruling is not due to a misapprehension? If you will be good enough to refer to the Money Resolution, it says that Income Tax shall be charged:
in the case of an individual whose total income from all sources exceeds £2,000 that such higher rates.… as Parliament may hereafter determine.
That is, such rates as Parliament may determine after the date of the Resolution. I submit most respectfully that the Money Resolution expressly authorises Parliament at any time after the passing of the Resolution to settle the tax at "such higher rates as Parliament may determine."

The DEPUTY-CHAIRMAN: I am advised that the term "hereafter" means next year, not this year.

Sir D. HERBERT: Although it is in the Resolution?

The DEPUTY-CHAIRMAN: I think the hon. Member should proceed with his Amendment.

Sir HENRY CAUTLEY: I have an Amendment on the Order Paper of a similar character, and I should like to put this point to you. The Financial Resolution declares that in the case of Surtax—

The DEPUTY-CHAIRMAN: We cannot discuss these Amendments at this point. I called upon the hon. Member for Watford (Sir D. Herbert) to move his Amendment, because I thought he had agreed to do so in place of the one ruled out.

Sir H. CAUTLEY: I was speaking on the point of order.

The DEPUTY-CHAIRMAN: A point of Order does not arise now. We have not reached the Amendment of the hon. and learned Member yet.

Sir H. CAUTLEY: The hon. Member for Watford (Sir D. Herbert) has handed in a manuscript Amendment, but he does not desire to proceed with it if the later Amendments on the Order Paper in his name are in order. It is upon that point
of Order that I desire to say one or two words.

The DEPUTY-CHAIRMAN: I have called upon the hon. Member for Watford to move his Amendment. After discussion with him this manuscript Amendment was accepted in place of other.

Sir H. CAUTLEY: And it is upon that point that I want you to hear what I have to say on my Amendment, which appears later.

The DEPUTY-CHAIRMAN: We can deal with that when we come to the Amendment.

Sir D. HERBERT: I accept your interpretation of the Financial Resolution, but I must respectfully say that the point is one which I cannot quite follow, and I desire to reserve any rights I may have to raise the question at any subsequent stage of the Bill. I made some reference to the discussion that took place on the Financial Resolution in regard to the meaning of these words, the reason for inserting them here, and the effect of them. I am afraid that it will be necessary for me, in discussing this Amendment, to refer to Clause 8. I do not propose to discuss Clause 8 now, because there are on the Paper Amendments to it in regard to the fixing of what is known as Surtax for the year 1928–29; but I think it is necessary to explain to the Committee what I take to be the reason why the apparently meaningless and ineffective words appear in this particular Clause. All those who are acquainted with the Income Tax law know that Surtax under the Act of 1927, by which it was first created, is a deferred instalment of Income Tax. The Surtax for any particular financial year is not payable until the 1st January of the following financial year. Therefore, the Surtax payable on 1st January of next year will be the Surtax for the financial year which ended on 5th April last.
It will be observed that Clause 8 deals with Surtax for the year 1928–29, which will be payable on 1st January next. Therefore, it will be received within this financial year, although it is last year's tax. Clause 8 proposes to deal with the tax which was last year's tax but payable in this year, and to increase it. I imagine, therefore, that the intention, in putting these words into this
Clause, is to give a lead to Parliament to the effect that it shall generally be regarded as the customary thing to deal with the rate of Surtax for any particular year, not in the Finance Act of the year for which the tax is levied, but in the Finance Act for the year in which the tax is collected and received by the revenue. It seems to me that under Clause 8 the Chancellor of the Exchequer is contemplating the unforgivable Parliamentary and Constitutional sin of endeavouring to increase a tax for a past year which has been fixed by a past Finance Act. That, however, is a matter to be discussed when we come to Clause 8, and I only wish in passing to point out that these words which the right hon. Gentleman admits are put in more or less as a sort of lead to Parliament as to what it should do in the future, are, in fact, a lead to Parliament to be guilty of what I have already described as an unforgivable Parliamentary and Constitutional sin.
There is another point of considerable importance which arises on this Amendment, and to which I frankly believe that I shall get the answer which I hope for from the Chancellor of the Exchequer. Much as I differ from the right hon. Gentleman in many things I will, if I may respectfully do so, pay him the compliment of saying that I believe that he desires to uphold in every way the protection of those old Standing Orders which deal with our financial procedure. I can hardly hope that the Government will agree to the Amendment but if they do not, I wish, at least, to have an expression from the Chancellor of the Exchequer that he does not contemplate and the Revenue do not contemplate, if this Clause is passed in this form, that it will then be competent for Parliament in next year's Finance Bill—this Clause being founded on a Financial Resolution—to impose a higher rate of Surtax, in pursuance of this Clause, without founding it upon a new Financial Resolution during next Session. If one could get a definite expression of opinion from the Front Bench, to that effect, it would dispose of a certain amount of the anxiety which is felt on this side.
I pass to the main point of the Amendment, and I respectfully but very earnestly urge that these words cannot
have any effect—that they are a mere indication to Parliament. We all know that Parliament may do whatever it chooses to do, and, as there is a considerable body of opinion which considers that Surtax for a particular year ought to be fixed in that year, and as the present Government, however notable they may be, do not, I am sure, regard themselves as immortal or as always to rule, I hope that they will leave out of this Clause what I have described as an indication to Parliament that in future Parliament ought to take a course which in the opinion of many would be the wrong course for Parliament to pursue. Parliament ought not to commit itself unnecessarily to a Clause indicating a course of action which does not find favour with a great body of opinion in this House. I do not desire to prolong the discussion, and having, I hope, made my point clear I await a reply to the question which I have raised.

Mr. PETHICK-LAWRENCE: The hon. Member has raised three separate points. The largest point of all, the decision of the Government to impose a Surtax for the year 1929–30 in the present Budget, is one which, I understand, he does not wish to discuss on this particular Amendment, because it will come up later. The two other points with which he has dealt are these. In the first place, he asked a question whether the passage of the Clause in the form in which it appears in the Finance Bill will still necessitate a Financial Resolution next year before any higher rate or any rate of Surtax is imposed. The answer to that is in the affirmative. It will still be necessary, assuming that the Clause is carried in its present form, to have a Financial Resolution—

Mr. SMITHERS: Whatever the rate?

Mr. PETHICK-LAWRENCE: Yes, it will still be necessary to have a Financial Resolution, certainly for a higher rate.

Mr. SMITHERS: Supposing the rate is not changed?

Mr. PETHICK-LAWRENCE: It will still be necessary under any circumstances to have a Financial Resolution. The hon. Member for Watford (Sir D. Herbert) then asked why these words have been inserted. The reason is somewhat peculiar. It is because of the precise
form of Section 38 of the Finance Act of 1927. The words used in that Section imply that the Income Tax of any given year shall be at two different rates, one for people below a certain figure of income, and varying rates for people above that figure—

Sir D. HERBERT: Additional varying rates?

Mr. PETHICK - LAWRENCE: The essential part of Section 38 is that there shall be a standard rate, and for persons above a certain amount of income there shall be an additional rate. I am advised that, unless these words which we are proposing are retained in this Clause, some doubt will arise as to the right to carry through the necessary regulations with regard to Income Tax. It is not a question of the Surtax next year. It is a question of the standard rate of Income Tax for the current year, and, in order to secure that the necessary provisions in regard to Income Tax apply to the standard rate for the current year, it is necessary that these words should be retained in the Clause. That is the purely technical reason why the retention of these words are necessary.

Sir D. HERBERT: I thank the hon. Gentleman for what he said in the first part of his reply, which entirely satisfies me. I asked the question not so much for any fear that I might have, but because I was anxious in the interests of our financial procedure to get a definite pronouncement from the Front Bench and on that matter I am quite satisfied. I am sorry, however, that the hon. Gentleman does not by any means satisfy me with regard to the second point. He showed how he is likely to be misled over this matter and how, if I may say so, he does not really grasp the case, judging by the words that he used in the beginning of his speech, where he appeared to infer that Income Tax was charged at a varying or graduated rate. It was there that I interrupted him, because this is a mistake which appears in other parts of the Bill. Income Tax most definitely persists in two separate parts. One is Income Tax commonly so-called, which, according to the legal language of the statute, is the standard rate of Income Tax. It is important to remember that Income Tax, apart from Surtax, is not a graduated tax. There are reliefs, it is true, but even those reliefs
do not make it a graduated tax. It is a, standard tax, and it is payable by all the taxpayers, and the relief that is given is given in the form of relief from the tax which is payable. Then we come to the Surtax, as it is called in the statute, which is Income Tax at a higher rate than the standard rate and is charged upon incomes above a certain amount. In dealing with this point the Financial Secretary said, "I am advised," but he must forgive me for saying that that is no answer to us unless he can explain the advice.
We have the advantage of the presence of the Attorney-General on the Treasury Bench, and I hope he will go into this point. I listened to a speech by him elsewhere some time ago in which he spoke of the necessity of getting this tax legislation in a form in which it could be understood by persons of ordinary intelligence; but it seems to me that the hon. Gentleman's answer to my question has only increased the fog. How can the leaving out of these apparently meaningless words interfere with the due imposition and collection during the present financial year of the standard Income Tax for this year? If there be a difficulty about that I would like to have it explained. I thought I had pointed out in my earlier remarks that if it is to be the custom of the House of Commons to fix the Surtax for the year in respect of which it is assessed not in the year for which it is assessed but in the following year, in which this deferred instalment of Income Tax is to be actually received, we shall be taking a course which we do not want to encourage and one which I have ventured to describe as an unforgiveable sin from every point of constitutionalism and Parliamentary procedure.

The ATTORNEY-GENERAL (Sir William Jowitt): The difficulty which the hon. and learned Gentleman feels really arises from half-a-dozen words in Section 38 of the Finance Act of 1927. Those words are:
where Income Tax is so charged.
Where Income Tax is so charged certain consequences follow and certain enactments apply. The meaning of the words "so charged" is plain from the first part of the Section, and where in any year you charge Income Tax at the standard rate you also charge Surtax, then certain
consequences follow, certain enactments apply, and certain machinery is operative. Unless you use some such words you do not comply with the condition in Section 38 so as to get the benefit of the machinery which Section 38 provides, because it is necessary that the Income Tax should be so charged, that is to say, that you should charge both Income Tax and Surtax. It is simply reason to bring ourselves within the words of Section 38 of the Finance Act of 1927 that the machinery therein provided may apply. That is why the words are used.

Sir H. CAUTLEY: There does not seem to me to be any reason whatever for the inclusion of the words to which we are objecting, and which are quite meaningless.

Mr. SMITHERS: I desire to ask the Attorney-General a question. In the Bill under discussion the word "Surtax" is not, mentioned until we reach Clause 12. Clause 38 of the Finance Act of 1927 refers to Income Tax so charged for any year at the rate or rates exceeding the standard rate. In the Clause under discussion it says "at such higher rates." I look at the Finance Bill of 1929, and there is no scale in that Act, because, I take it, there was no change in the rate. Therefore, you have to refer back to the Finance Act of 1928. In the Finance Act of 1928 the table reads:


"For every pound of the first five hundred pounds of the excess.
Four shillings and nine-pence.


being the amount of the standard rate plus the excess Surtax. That applies also to the 1929 Act, the table for the Surtax being given in full with the standard rate plus the addition. In this Bill, in Clause 8, it is given as "one shilling, one shilling and threepence," etc., to which you have to add the standard rate. Why has that different method been adopted in this Bill as compared with the Act of 1928 and is that the reason why the words "such higher rates" have been put into this Bill?

Mr. WARDLAW-MILNE: I should like to ask the Attorney-General whether the whole confusion does not arise owing to this different setting up of the increased rates of Income Tax, or what used to be known as the rate of Income Tax plus Super-tax. If in Clause 8 the rates had been set out in full, i.e., the standard
rate plus the Surtax, then surely the words in Clause 7, paragraph 1, would have read, not
as Parliament may hereafter determine,
but
as set out in the Clause which follows.
That would have made the whole matter quite clear.

The ATTORNEY-GENERAL: May I say I do not withdraw one single word of what I said before, but I do think that all sections of the House ought to do everything they can to simplify not only this but all other legislation in order that we may have some idea of what it is all about. With regard to the question which I have been asked and which seems to arise on Clause 8, I do not think that there is any great difficulty. There are set out in Clause 8 the rates which exceed the standard rate. All you have to do is to add the sums therein mentioned to the sum of 4s. I do not suppose that has been done to make it more difficult. I frankly say I do not know what is the reason why it is done in that way, but it is not difficult to arrive at the result. With regard to the question arising under Clause 7, if we stop at the word "pound" we should be holding out undue expectations to the taxpayer, because nobody really supposes that Income Tax for the year 1930–31 shall be charged at the standard rate of 4s. 6d. only. Unfortunately, we all anticipate that in the year 1931 Income Tax will be charged at some higher rate. Surtax is a part of Income Tax. Income Tax consists of the standard rate plus surtax. We all know perfectly well that Income Tax for the year 1930–31 will be charged not only at the standard rate, but at some rate of Surtax. It would be entirely misleading to leave the taxpayers to suppose that the only Income Tax payable for that year is the standard rate. With regard to the point about specifying the rates, I agree that this is a highly technical point, but I think that, if hon. Members consider Section 38 of the Finance Act of 1927 strictly and technically, they will find it specified that there is to be a higher rate, and, although what it is is not specified, we do comply with Section 38 so as to render possible the rest of the machinery therein provided. That, at any rate, is the view of the Income Tax experts, and it is a view with which I am not disposed to disagree, after having gone into the matter.

Mr. MOND: I really think that this matter ought to be made clear. We have had several speeches from the Front Bench, but they have not thrown very much light upon it. The Financial Secretary to the Treasury has sheltered himself behind a form of words which we are proposing to leave out, but in which he is advised there is some virtue; and the Attorney-General is sheltering himself behind some machinery in Clause 38 of the Finance Act, 1927, which he has not explained to the Committee at all. It is impossible for hon. Members to follow the course of the discussion if the whole matter is not put plainly and clearly before them. We have to pass this evening legislation which is imposing a grievous burden upon the country, and it is right that we should at least understand what we are doing. I think we might have a speech from the Front Bench making it quite clear how we are to relate this particular mumbo-jumbo which we are trying to leave out, because no one can explain it to us, to the machinery, which has not been explained to us either, in a Finance Act of three years ago. I appeal to right hon. Gentlemen on the Front Bench opposite to make the position sufficiently clear to us to be able at any rate to take up a reasonable position on the matter. We are asked to pass this Clause, which says:
and, in the case of an individual whose total income from all sources exceeds two thousand pounds, at such higher rates in respect of the excess over two thousand pounds as Parliament may hereafter determine.
That is clearly leaving an obligation upon Parliament to increase the rate at some future date, without considering any of the causes or effects that may be appropriate at that time. I would ask the Attorney-General or the Financial Secretary to the Treasury, or, possibly, the Chancellor of the Exchequer himself, to make clear to us exactly what he proposes to do.

Sir D. HERBERT: I think that perhaps the proper way of ending this discussion would be for me, if the Committee will give me leave, to withdraw the Amendment, because there does not seem to be any particular point in proceeding with it. I feel, however, that I cannot do that until I have said just a word or two on the Attorney-General's defence with regard to this Clause. I quite understand his point as to the necessity,
under Section 38 of the Act of 1927, of charging Income Tax for one year at the standard rate and at an increased rate—that is to say, a Surtax; but, if he will allow me to say so, the fact that he has to do that under the Act of 1927 is about the best proof that I can want of the suggestion that I first made, namely, that the Government are committing a sin in endeavouring to alter this particular tax for last year, and are equally committing a sin in avoiding the charging of the tax for this year at a particular and specified rate, whatever they wish it to be, during this year.
The hon. and learned Gentleman's defence, therefore, clearly is: "According to the law as it stands I am doing something, or attempting to do something, which the Income Tax law does not allow me to do. I must, therefore, resort to some sort, of shift in order to do it, and I therefore propose to put apparently ridiculous words into an Act of Parliament to say that this particular Surtax shall be charged at a rate which shall be determined hereafter." The only possible thing to be said about it is that this Clause proposes to charge, not only Income Tax at the standard rate, at a particular figure, but the increased Income Tax called Surtax, also at a particular figure.
11.0 p.m.
I venture to remind the Committee that is was my wish originally to move Amendments to fix the increased rate of this Surtax for the present year in this Bill. You, Sir, have ruled that out of order and, therefore, at this stage at any rate, we have no remedy and we cannot move that particular form of Amendment. But I propose to raise the question again on Report, because I regard it as one of immense importance and, in the meantime, we shall probably have further light thrown upon it, or we must have some further discussion which will bear on the point when we come to the next Clause, where the Government propose to alter the rate of Surtax which was fixed by last year's Finance Act.

Sir H. CAUTLEY: Before the Amendment is withdrawn, I should like to ask the Attorney-General to answer this point. Section 38 of the Finance Act, 1927, on which he relies, requires that the Finance Act for the year should specify the standard rate of Income Tax,
and should also specify the rate or rates for the Surtax for the particular year. Are not these words which are sought to be included in this Clause directly contrary to the wording of Section 38, and is it not really an attempt to alter the Act of 1927 without informing Parliament about it? Is it really the way our finance ought to be conducted? Ever since 1860, Income Tax has been levied and collected as a yearly tax. Income Tax and Super-tax have always been for the particular year for which it was levied. There is a good deal more substance in the Amendment than the Committee have yet realised.

Major NATHAN: It is clear that, to put it no higher, this matter is by no means free from difficulty. I should like to ask the Chancellor of the Exchequer to follow me in the practical application of the Sub-section and of Clause 8, from which it cannot be dissociated. It seems to me that the way the matter will work out in practice will be this. Under Clause 8, Surtax for 1929–30 is to be charged at certain rates. The returns for assessment for the Revenue of the year 1929–30 have already been made, the rate has been fixed, and the tax will become payable in January, 1931. One position as regards the Revenue year 1930–31, therefore, is that no tax can be levied in respect of Super-tax until after a new Financial Resolution has been passed. I may have misunderstood the Financial Secretary. The question which I should like to ask is, should the Financial Resolution be passed before the ordinary time of producing the Budget or at that time.

Mr. SMITHERS: I apologise for keeping the Committee, but this is a very important point. Will the Attorney-General look up the Finance Act of 1928, Section 15 (1, b)? I ask the Committee to note the words:
(b) in the case of an individual whose total income from all sources exceeds two thousand pounds, at the following higher rates in respect of the excess over two thousand pounds.
Then follows the various rates. Why in this Finance Bill is it necessary to alter that wording and to put in the words:
in the case of an individual whose total income from all sources exceeds two thousand pounds, at such higher rates in respect of excess" etc.
Why is it necessary to change the method? In the Finance Act of 1928 "the following higher rates" are very definitely fixed, but in the present Finance Bill the words "at such higher rates" make a subsequent change possible.

Mr. REID: May I ask the Attorney-General what this Clause means? The words are:
whose total income from all sources exceeds two thousand pounds, at such higher rates in respect of the excess over two thousand pounds.
The "higher rates" cannot refer to Clause 8. Does it mean that the rate of Surtax to be payable on the 1st January, 1931, is to be unknown? Is the rate which a person liable to Surtax will have to pay not to be known until the Budget Resolution for next year has been passed, or will it be possible for the individual so to regulate his expenditure this year that he will be in a position to pay the tax by the 1st January next year without having any subsequent demand in respect of that year made upon him?

Mr. CHURCHILL: May I suggest that the Financial Secretary should give some clear indication of the intention of the Government to re-examine this matter before the Report stage? We are anxious to facilitate the progress of business, but the point that has arisen is one of real substance and difficulty. It seems not at all unlikely that the words inserted do not achieve the object they have in view or, if they do achieve it, they raise other difficulties of a constitutional character which it is desired to avoid. I suggest that, instead of carrying the matter further at this moment, the Chancellor of the Exchequer or the Financial Secretary should make it clear that it is going to have the concentrated attention of the Government and the Law Officers of the Crown, and that we shall have an opportunity on report of going into it in full detail and, we trust, in a more satisfactory form.

Mr. P. SNOWDEN: No one knows better than does the right hon. Gentleman, after his experience of two years ago, what a complicated matter this is and how difficult it is to make it clear. I have no objection at all to taking the matter into further consideration, and seeing if we possibly can bring it forward in a way
that is more comprehensible to those who are not lawyers, but I am advised that it will be difficult to put it in a plainer form than in the words of the Clause. However, we will apply what ingenuity we have between now and the Report stage to seeing what can be done.

Mr. LEIF JONES: I do not know whether I quite understand what we are doing here, but I understand that we are not fixing the amount of tax to be paid by a taxpayer except what is due on 1st January next. The Income Tax payable on 1st January would be at the standard rate of 4s. 6d. on the income of the current year, 1930–31, but Surtax would be payable on the income of the preceding year, that is, on the income of the year 1929–30, which is already ascertained. That is to say, we are dealing with taxes which are payable on 1st January, 1931, but on incomes of different years, and we are not increasing now any rate of tax which is to be payable at any later time than 1st January, 1931.

Lieut.-Colonel Sir FREDERICK HALL: My hon. Friend the Member for Watford (Sir D. Herbert) has indicated that in all probability he will withdraw his Amendment, but I want it made clear that, if no Division is taken, we reserve all rights to raise any question on the Report stage.

Sir D. HERBERT: I hope I have made it clear already that we are not in any way prejudiced by withdrawing this Amendment, and in those circumstances I ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

The following Amendment stood upon the Order Paper in the name of Mr. C. WILLIAMS:

In page 5, line 30, to leave out Subsection (2).

Mr. C. WILLIAMS: As this Amendment raises the question of the whole of the enactments under which the Income Tax is collected and is of great importance, and, owing to various factors, it is not convenient to discuss it at adequate length, I do not wish to move it. I shall put down the Amendment again on the Report stage, when I hope that the Chancellor of the Exchequer will see that we have adequate time in which to discuss the enactments under which the Income Tax is collected.

Sir D. HERBERT: I beg to move, in page 5, line 33, at the end, to insert the words:
but subject to all amendments of, or alterations in, such enactments made by this Act.
The Amendment is a simple one put down with the intention of improving the drafting and making the matter clear. The Sub-section applies all existing enactments referring to the Income Tax to the Income Tax charged for the present year. Considerable alterations are proposed to be made in these enactments in the course of this Bill, and I suggest that in order to prevent the Act from being misread the proposed words should be added.

Mr. P. SNOWDEN: The hon. Member's Amendment is unnecessary. For instance, it is enacted in Sub-section (5) of Clause 47 of this Bill that:
Any reference in this Act to any enactment shall be construed as a reference to that enactment as amended by any subsequent enactment, including this Act.
I think that that makes the Amendment of the hon. Member unnecessary.

Sir D. HERBERT: I agree that, according to the words suggested, my Amendment is not necessary. It is only a question whether the words will apply to it. That may be a, matter of opinion, and one may be entitled to differ, but, in the circumstances, I will not press the Amendment, but ask the leave of the Committee to withdraw it.

Amendment, by leave, withdrawn.

Mr. CHURCHILL: I have handed in a manuscript Amendment in the following terms: In page 6, line 33, at the end, to insert the words:
(3) Notwithstanding anything contained in the last preceding sub-section, the first sub-section of Section fifteen of the Finance Act, 1925, shall have effect as if for the words 'equal to one-sixth of the amount of that income' there were substituted the words 'equal in the case of an individual whose total income does not exceed fifteen hundred pounds, one-fourth of the amount of that income, and in the case of an individual whose total income exceeds fifteen hundred pounds and does not exceed two thousand pounds, one-fifth of the amount of that income' and for the words 'two hundred and fifty' there were substituted the words 'five hundred' and as if for the words 'one-sixth' in the second sub-section there were substituted the words 'one-fourth.'

Mr. SNOWDEN: On a point of Order. You have ruled, Mr. Dunnico, that a number of Amendments on the Paper are not appropriate as Amendments to the Clause, but should be moved as a new Clause. May I submit that the long Amendment just read by the right hon. Gentleman is hardly suitable as an Amendment to a Clause which deals with enactments to carry out the Income Tax Acts and which does not raise the question of a revision of those Acts? Further, may I say that we have had no copy of the Amendment, and it is unreasonable to ask us to discuss it without having had an opportunity of considering it?

Mr. CHURCHILL: I was about to conclude by saying that I do not propose to move the Amendment to-night and was going to suggest that I should bring it up on Report. But I think the suggestion of the Chancellor of the Exchequer is the better one and that it would be more appropriate to move it as a new Clause.

Motion made, and Question put, "That the Clause stand part of the Bill."

The Committee divided: Ayes, 257; Noes, 147.

Division No. 333.]
AYES.
[11.25 p.m.


Adamson, Rt. Hon. W. (Fife, West)
Gardner, B. W. (West Ham, Upton)
Lawson, John James


Adamson, W. M. (Staff., Cannock)
Gardner, J. P. (Hammersmith, N.)
Lawther, W. (Barnard Castle)


Addison, Rt. Hon. Dr. Christopher
Gibbins, Joseph
Leach, W.


Aitchison, Rt. Hon. Craigie M.
Gibson, H. M. (Lancs. Mossley)
Lee, Frank (Derby, N. E.)


Alpass, J. H.
Gill, T. H.
Lee, Jennie (Lanark, Northern)


Ammon, Charles George
Gillett, George M.
Lees, J.


Arnott, John
Gossling, A. G.
Lewis, T. (Southampton)


Aske, Sir Robert
Gould, F.
Lindley, Fred W.


Ayles, Walter
Graham D. M. (Lanark, Hamilton)
Lloyd, C. Ellis


Baldwin, Oliver (Dudley)
Graham, Rt. Hon. Wm. (Edin., Cent.)
Logan, David Gilbert


Barnes, Alfred John
Granville, E.
Longbottom, A. W.


Batey, Joseph
Gray, Milner
Longden, F.


Bellamy, Albert
Grenfell, D. R. (Glamorgan)
Lovat-Fraser, J. A.


Benson, G.
Griffith, F. Kingsley (Middlesbro' W.)
Lunn, William


Bentham, Dr. Ethel
Griffiths, T. (Monmouth, Pontypool)
Macdonald, Gordon (Ince)


Bevan, Aneurin (Ebbw Vale)
Groves, Thomas E.
MacDonald, Malcolm (Bassetlaw)


Birkett, W. Norman
Grundy, Thomas W.
Macdonald, Sir M. (Inverness)


Bowen, J. W.
Hall, F. (York, W. R., Normanton)
McElwee, A.


Broad, Francis Alfred
Hall, G. H. (Merthyr Tydvil)
McEntee, V. L.


Bromfield, William
Hall, Capt. W. P. (Portsmouth, C.)
McKinlay, A.


Bromley, J.
Hamilton, Mary Agnes (Blackburn)
MacNeill-Weir, L.


Brooke, W.
Harbord, A.
McShane, John James


Brothers, M.
Hardie, George D.
Malone, C. L'Estrange (N'thampton)


Brown, C. W. E. (Notts, Mansfield)
Harris, Percy A.
Mansfield, W.


Brown, Ernest (Leith)
Hastings, Dr. Somerville
Marcus, M.


Brown, Rt. Hon. J. (South Ayrshire)
Haycock, A. W.
Markham, S. F.


Brown, W. J. (Wolverhampton, West)
Hayday, Arthur
Marley, J.


Buchanan, G.
Henderson, Arthur, Junr, (Cardiff, S.)
Mathers, George


Burgess, F. G.
Henderson, Thomas (Glasgow)
Matters, L. W.


Burgin, Dr. E. L.
Henderson, W. W. (Middx., Enfield)
Maxton, James


Caine, Derwent Hall-
Herriotts, J.
Melville, Sir James


Cameron, A. G.
Hirst, G. H. (York W. R. Wentworth)
Messer, Fred


Cape, Thomas
Hirst, W. (Bradford, South)
Middleton, G.


Carter, W. (St. Pancras, S. W.)
Hoffman, P. C.
Milner, Major J.


Charieton, H. C.
Hollins, A.
Montague, Frederick


Chater, Daniel
Hopkin, Daniel
Morgan, Dr. H. B.


Church, Major A. G.
Horrabin, J. F.
Morley, Ralph


Clarke, J. S.
Hudson, James H. (Huddersfield)
Morris-Jones, Dr. J. H. (Denbigh)


Cluse, W. S.
Hunter, Dr. Joseph
Morrison, Herbert (Hackney, South)


Clynes, Rt. Hon. John R.
Hutchison, Maj.-Gen. Sir R.
Morrison, Robert C. (Tottenham, N.)


Cocks, Frederick Seymour
Isaacs, George
Mort, D. L.


Compton, Joseph
Jenkins, W. (Glamorgan, Neath)
Moses, J. J. H.


Daggar, George
John, William (Rhondda, West)
Mosley, Lady C. (Stoke-on-Trent)


Dallas, George
Johnston, Thomas
Mosley, Sir Oswald (Smethwick)


Dalton, Hugh
Jones, F. Llewellyn- (Flint)
Muff, G.


Davies, E. C. (Montgomery)
Jones, J. J. (West Ham, Silvertown)
Muggeridge, H. T.


Davies, Rhys John (Westhoughton)
Jones, Rt. Hon. Leif (Camborne)
Nathan, Major H. L.


Denman, Hon. R. D.
Jones, Morgan (Caerphilly)
Naylor, T. E.


Dickson, T.
Jones, T. I. Mardy (Pontypridd)
Newman, Sir R. H. S. D. L. (Exeter)


Dukes, C.
Jowett, Rt. Hon. F. W.
Noel Baker, P. J.


Duncan, Charles
Jowitt, Rt. Hon. Sir W. A.
Oldfield, J. R.


Ede, James Chuter
Kedward, R. M. (Kent, Ashford)
Oliver, George Harold (Ilkeston)


Edmunds, J. E.
Kennedy, Thomas
Oliver, P. M. (Man., Blackley)


Edwards, E. (Morpeth)
Kinley, J.
Owen, H. F. (Hereford)


Egan, W. H.
Kirkwood, D.
Palin, John Henry.


Elmley, Viscount
Lang, Gordon
Paling, Wilfrid


Evans, Capt. Ernest (Welsh Univer.)
Lathan, G.
Palmer, E. T.


Foot, Isaac
Law, Albert (Bolton)
Parkinson, John Allen (Wigan)


Forgan, Dr. Robert
Law, A. (Rosendale)
Perry, S. F.


Freeman, Peter
Lawrence, Susan
Peters, Dr. Sidney John


Pethick-Lawrence, F. W.
Shinwell, E.
Walker, J.


Picton-Turbervill, Edith
Short, Alfred (Wednesbury)
Wallace, H. W.


Potts, John S.
Simmons, C. J.
Watkins, F. C.


Price, M. P.
Sinkinson, George
Watson, W. M. (Dunfermline)


Pybus, Percy John
Sitch, Charles H.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Quibell, D. J. K.
Smith, Alfred (Sunderland)
Wellock, Wilfred


Ramsay, T. B. Wilson
Smith, Frank (Nuneaton)
Welsh, James (Paisley)


Rathbone, Eleanor
Smith, Rennie (Penistone)
West, F. R.


Richards, R.
Smith, Tom (Pontefract)
Westwood, Joseph


Richardson, R. (Houghton-le-Spring>
Smith, W. R. (Norwich)
White, H. G.


Ritson, J.
Snowden, Rt. Hon. Philip
Whiteley, Wilfrid (Birm., Ladywood)


Romeril, H. G.
Snowden, Thomas (Accrington)
Wilkinson, Ellen C.


Rosbotham, D. S. T.
Sorensen, R.
Williams, David (Swansea, East)


Rowson, Guy
Stamford, Thomas W.
Williams, Dr. J. H. (Llanelly)


Russell, Richard John (Eddisbury)
Stephen, Campbell
Williams, T. (York, Don Valley)


Salter, Dr. Alfred
Strachey, E. J. St. Loe
Wilson, C. H. (Sheffield, Attercliffe)


Samuel, H. W. (Swansea, West)
Strauss, G. R.
Wilson, J. (Oldham)


Sanders, W. S.
Sullivan, J.
Wilson, R. J. (Jarrow)


Sandham, E.
Sutton, J. E.
Winterton, G. E. (Leicester, Loughb'gh)


Sawyer, G. F.
Thorne, W. (West Ham, Plaistow)
Wise, E. F.


Scott, James
Tinker, John Joseph
Wood, Major McKenzie (Banff)


Scrymgeour, E.
Tools, Joseph
Wright, W. (Rutherglen)


Sexton, James
Tout, W. J.
Young, R. S. (Islington, North)


Shepherd, Arthur Lewis
Townend, A. E.



Sherwood, G. H.
Turner, B.
TELLERS FOR THE AYES.—


Shield, George William
Vaughan, D. J.
Mr. Charles Edwards and Mr.


Shillaker, J. F.
Viant, S. P.
William Whiteley.


NOES.


Acland-Troyte, Lieut.-Colonel.
Everard, W. Lindsay
Peto, Sir Basil E. (Devon, Barnstaple)


Albery, Irving James
Falle, Sir Bertram G.
Pownall, Sir Assheton


Atkinson, C.
Ferguson, Sir John
Ramsbotham, H.


Balfour, Captain H. H. (I. of Thanet)
Fermoy, Lord
Rawson, Sir Cooper


Balniel, Lord
Fielden, E. B.
Reid, David D. (County Down)


Beaumont, M. W.
Fison, F. G. Clavering
Remer, John R.


Betterton, Sir Henry B.
Ford, Sir P. J.
Reynolds, Col. Sir James


Bevan, S. J. (Holborn)
Forestier-Walker, Sir L.
Richardson, Sir P. W. (Sur'y, Ch'ts'y)


Bird, Ernest Roy
Fremantle, Lieut.-Colonel Francis E.
Roberts, Sir Samuel (Ecclesall)


Boothby, R. J. G.
Gault, Lieut.-Col. Andrew Hamilton
Ross, Major Ronald D.


Bourne, Captain Robert Croft
Gibson, C. G. (Pudsey & Otley)
Russell, Alexander West (Tynemouth)


Boyce, H. L.
Gower, Sir Robert
Salmon, Major I.


Bracken, B.
Graham, Fergus (Cumberland, N.)
Samuel, A. M. (Surrey, Farnham)


Brass, Captain Sir William
Grattan-Doyle, Sir N.
Samuel, Samuel (W'dsworth, Putney)


Briscoe, Richard George
Greene, W. P. Crawford
Sandeman, Sir N. Stewart


Brown, Col. D. C. (N'th'l d'., Hexham)
Grenfell, Edward C. (City of London)
Sassoon, Rt. Hon. Sir Philip A. G. D.


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Gretton, Colonel Rt. Hon. John
Savery, S. S.


Buckingham, Sir H.
Gritten, W. G. Howard
Shepperson, Sir Ernest Whittome


Butler, R. A.
Hall, Lieut.-Col. Sir F. (Dulwich)
Sinclair, Col. T. (Queen's U., Belfast)


Cadogan, Major Hon. Edward
Hamilton, Sir George (Ilford)
Smith, Louis W. (Sheffield, Hallam)


Carver, Major W. H.
Hammersley, S. S.
Smith-Carington, Neville W.


Cayzer, Sir C. (Chester, City)
Hartington, Marquess of
Smithers, Waldron


Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.)
Harvey, Major S. E. (Devon, Totnes)
Somerville, A. A. (Windsor)


Cazalet, Captain Victor A.
Haslam, Henry C.
Somerville, D. G. (Willesden, East)


Chamberlain, Rt. Hon. N. (Edgbaston)
Henderson, Capt. R. R. (Oxf'd, Henley)
Southby, Commander A. R. J.


Christie, J. A.
Heneage, Lieut.-Colonel Arthur P.
Spender-Clay, Colonel H.


Churchill, Rt. Hon. Winston Spencer
Herbert, Sir Dennis (Hertford)
Stanley, Lord (Fylde)


Cobb, Sir Cyril
Hills, Major Rt. Hon. John Walter
Stanley, Maj. Hon. O. (W'morland)


Colfox, Major William Philip
Hudson, Capt. A. U. M. (Hackney, N.)
Steel-Maitland, Rt. Hon. Sir Arthur


Colman, N. C. D.
Iveagh, Countess of
Stuart, Hon. J. (M'oray and Nairn)


Colville, Major D. J.
Jones, Sir G. W. H. (Stoke New'gton)
Thomas, Major L. B. (King's Norton)


Courtauld, Major J. S.
Knox, Sir Alfred
Titchfield, Major the Marquess of


Cranborne, Viscount
Lamb, Sir J. Q.
Todd, Capt. A. J.


Crichton-Stuart, Lord C.
Lane Fox, Col. Rt. Hon. George R.
Train, J.


Croft, Brigadier-General Sir H.
Leighton, Major B. E. P.
Turton, Robert Hugh


Crookshank, Capt. H. C.
Long, Major Eric
Vaughan-Morgan, Sir Kenyon


Croom-Johnson, R. P.
Macdonald Capt. P. D. (I. of W.)
Wallace, Capt. D. E. (Hornsey)


Culverwell, C. T. (Bristol, West)
MacRobert, Rt. Hon. Alexander M.
Ward, Lieut.-Col. Sir A. Lambert


Dalkeith, Earl of
Margesson, Captain H. D.
Warrender, Sir Victor


Dalrymple White, Lt.-Col. Sir Godfrey
Marjoribanks, E. G.
Waterhouse, Captain Charles


Davies, Dr. Vernon
Mason, Colonel Glyn K.
Wells, Sydney R.


Davison, Sir W. H. (Kensington, S.)
Mond, Hon. Henry
Williams, Charles (Devon, Torquay)


Dixey, A. C.
Monsell, Eyres, Com. Rt. Hon. Sir B.
Windsor-Clive, Lieut.-Colonel George


Dixon, Captain Rt. Hon. Herbert
Morrison, W. S. (Glos., Cirencester)
Wolmer, Rt. Hon. Viscount


Duckworth, G. A. V.
Nicholson, O. (Westminster)
Womersley, W. J.


Eden, Captain Anthony
Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)
Wood, Rt. Hon. Sir Kingsley


Edmondson, Major A. J.
O'Connor, T. J.
Worthington-Evans, Rt. Hon. Sir L.


Elliot, Major Walter E.
O'Neill, Sir H.



England, Colonel A.
Penny, Sir George
TELLERS FOR THE NOES.—


Erskine, Lord (Somerset, Weston-s-M.)
Percy, Lord Eustace (Hastings)
Major Sir George Hennessy and




Sir Frederick Thomson.

CLAUSE 8.—(Alteration of higher rates of Income Tax for 1929–30.)

The DEPUTY-CHAIRMAN: The next Amendment which I select is that in the name of the hon. Member for East Lewisham (Sir A. Pownall), in page 6, line 11, to leave out the words "one shilling" and to insert instead thereof the word "Ninepence." As there is a series of Amendments dealing with the same point, it may be for the convenience of the Committee to have a general discussion.

Sir H. CAUTLEY: On a point of Order. Is my Amendment—to leave out "1929–30" and insert "1930–31"—out of order, or is it not selected?

The DEPUTY-CHAIRMAN: It is not selected.

Mr. CHURCHILL: On a point of Order. That particular Amendment raises an important point of substance, and I would invite you, as you have not selected it, to inform us at what point in the discussion of the Bill it will be proper to raise this matter because it clearly raises a great deal of public interest in the country.

Mr. REMER: May I ask you to repeat in a louder voice what Amendments you are selecting?

The DEPUTY-CHAIRMAN: I try as far as possible to select Amendments of relatively greater importance and substance than those passed over. The particular Amendment referred to by the right hon. Gentleman is not out of order, and if in his opinion it is one of great importance, I am willing to meet the wish of the Committee and select it.

Mr. CHURCHILL: I think that the general discussion that we are to have upon this Clause might just as advantageously take place on the Amendment of my hon. and learned Friend the Member for East Grinstead (Sir H. Cautley), as the one which you had previously selected, and, if you are willing in pursuance of what you have just said, to allow it to be taken on the Amendment of my hon. and learned Friend, that would be more in accordance with the wishes of those who sit on this side of the House.

The DEPUTY-CHAIRMAN: I am willing to permit that.

Sir H. CAUTLEY: I beg to move, in page 6, line 1, to leave out "1929–30," and to insert instead thereof "1930–31."
This clearly raises an important point of principle. Under the Finance Act of 1929, Section 1—
Income Tax for the year 1929–30"—
that is, for the year expiring on 5th April this year—
shall be charged at the standard rate of four shillings in the pound, and, in the case of an individual whose total income from all sources exceeds two thousand pounds, at the same higher rates in respect of the excess over two thousand pounds as were charged for the year 1928–29.
That complies with Section 31 of the Income Tax Act of 1927, which was referred to on a preceding Amendment and which required the Income Tax to be fixed on a higher rate for Surtax payers. Until the passage of the Finance Act, 1929, every Surtax payer and Income Tax payer, in accordance with what had been the custom since 1860, knew the amount of his liability, and he was in a position to provide for it and raise the taxes by the time they became payable. Payment of the Surtax is deferred to the 1st January following. The Surtax for 1929–30 becomes due on 1st January 1931. This Clause seeks to alter the rate of Surtax levied by the Finance Act for 1929. A year after the rate was then fixed, it is seeking to fix a different and, as it happens in this case, a higher rate. The preceding Clause, Clause 7, instead of fixing a definite rate of Surtax, left it to be fixed by a succeeding Session of Parliament. This is an entirely new method of procedure. According to the history of our financial legislation, His Majesty the King in his Speech from the Throne, asks the House of Commons to provide for the revenue of the particular year, and in each single year there is a separate Finance Bill dealing only with the revenue of the year.
If this alteration is allowed it will make it immensely more difficult for the tax-payer to provide for his liabilities. [Interruption.] Some hon. Members call out and ask me to speak up, and other hon. Members make it difficult for me to be heard by talking so loudly among themselves. Take the case of a Surtax payer who died on 1st June this year. He is liable to pay Surtax on his income
for the year 1930–31, which cannot be calculated until 5th April, 1931, and the amount he has to pay is not payable till 1st January, 1932. His estate cannot, therefore, be wound up, because they do not know the rate of tax which will be levied. It may not be this Parliament which is going to fix that rate of Surtax. That Surtax is to be fixed in the next Parliament, or in the next Session of this Parliament, and the amount cannot meanwhile be calculated. I submit to the Chancellor and his advisers that the administrative difficulties are almost insuperable, and that there will be immense hardship on Surtax payers. Surtax is an extremely oppressive tax, whatever view one may take of its justice. It requires a great deal of foresight to prepare for it, and the taxpayer is in a difficult position in preparing for it if he does not know the amount and if his executors are not going to know, in some cases, until long after he is dead. That is an absurd method of procedure in a civilised country, and I will leave it to be developed. I am not in the habit of using strong language. I am now proposing that we should revert to what has been the existing procedure since the Super-tax was first initiated, and fix the rate of the Surtax for the actual year with which we are dealing, and I am seeking, by my Amendment, to alter "1929–30" to "1930–31."

Sir D. HERBERT: I wish to say a few words in support of the Amendment which has been moved by my hon. and learned Friend the Member for East Grinstead (Sir H. Cautley). I observed that the Financial Secretary to the Treasury shook his head when my hon. and learned Friend made a certain statement of the position. [HON. MEMBERS: "Speak up!"] I think the Financial Secretary must have been under a misapprehension. Let me repeat that statement in order to see how far the hon. Member agrees with me. [HON. MEMBERS: "Speak up!"] I am speaking quite loudly, and hon. Members opposite who do not hear me can carry on their conversations much more conveniently to themselves as well as to us in the Smoking-room. I am suggesting to the Financial Secretary that under this Bill, as it is drawn at present, the Surtax at the increased rate for the present year 1930–31 is not payable until January, 1932. Is that plain? [Interruption.]
According to the provisions of this Bill, the tax for the year 1930–31 will be payable in 1932. Is that right?

Mr. PETHICK-LAWRENCE: The hon. Gentleman has not read Clause 21, which makes the matter plain.

Sir D. HERBERT: My point is not affected by that clause. It is far more important than that particular argument. I hope the country will take notice of what is being done. The tax for the year 1929–30, i.e., the financial year ending on 5th April last, was fixed perfectly properly, as it always has been, by the Finance Act of last year. The tax for the previous financial year was fixed by the previous year's Finance Act. This year the Chancellor is proposing to say that the tax for last year, which was fixed by last year's Finance Act, shall be altered and increased. In this Bill, it is proposed to pass a Clause which says that the tax for last year shall not be at the rate at which it was fixed in last year's Finance Act, but shall be at a higher rate. Let me put this matter in perfectly plain language. Parliament, within limits, can do what it chooses. It can be honest or dishonest. A man can enter into a contract to render certain services or transfer certain property to somebody else for the sum, let us say, of £5,000. That is governed by the ordinary law of contracts, and, when that bargain is concluded, he cannot come the next year and say that he is not going to do it for less than £6,000. The Government made a bargain and the liability of the taxpayer for last year was fixed. The whole matter to any honest intelligent person was closed and done with. Now the new Government comes along and in another Finance Bill makes provisions for another financial year and goes bank on last year and says, "You people who were taxed under last year's Act for last year at a certain rate are to be taxed for last year at a higher rate. We are going to take advantage of the fact that a certain part of your tax for last year is described in the Act of Parliament as deferred, and the deferred Income Tax which has not yet been paid will be increased." Is that honest? In all the many wrong things which the House of Commons has done I do not think it has ever done anything which is so dishonest to the taxpayer.
There is another point which I shall wish to refer to again in connection with this Bill, for we shall not finish all its stages to-night. I might say a word about the Section in the Act of 1927 which created this tax in its present existing form, known as the Surtax. The Attorney-General has explained to us most lucidly and clearly that that Act, which first created Surtax as an increased rate of Income Tax, and a deferred instalment of Income Tax, in Section 38 expressly provides that the Income Tax at the standard rate and the Income Tax at the increased rate shall be charged together for each year; and the Attorney-General says that, if you do not charge them both, you are not complying with the terms of that Section. Therefore, the Attorney-General ventures to defend a scheme by a method which I can only suggest might well have certain well-known slang terms applied to it—a "dodge" to "get out of" this Section of the Act of 1927 by saying: "It seems that we have got to charge both Income Tax and Surtax, but we propose to charge Income Tax at the standard rate, which we are stating, and we propose to charge the other as an unknown amount." Parliament, according to the Attorney-General, is actually proposing to charge the taxpayers of this country with a tax—that was the Attorney-General's own defence, his own explanation—for this year, the amount of which they are not to know until next year. It is no use the Financial Secretary shaking his head. I am prepared to stick to it, and I am perfectly certain that if the Attorney-General were here he would agree with me that the explanation I have given is perfectly and absolutely correct; it is nothing more than the explanation which the Attorney-General has already given himself on the previous Clause.
May I put this further point? These two taxes, if I may call them two taxes, or two portions of the Income Tax—I do not care how they are described—are so thoroughly one tax that the assessment for the purposes of the standard rate of Income Tax in any one year is made conclusive on the taxpayer for the purposes of the Surtax. Therefore, again you have the clearest evidence that Parliament intended, in passing the Act of 1927
—and, indeed, one could only suppose in those days that Parliament did intend—to do something which was perfectly honourable. And let it be remembered that Income Tax, whether it be the standard rate of Income Tax, or whether it be Surtax—the increased rate of Income Tax—is an annual tax. There is no Income Tax and no Surtax imposed upon the taxpayers of this country except from year to year, and for that particular year. [Interruption.] We know, of course, that we shall get it every year, but my point is that the fact that these two taxes, or two branches of one tax, are, under our financial system, re-imposed every year, and each year only for one year at a time, is an additional argument to show that the two branches of the one tax ought both to be dealt with together, and that it never was the intention of Parliament that the standard rate of tax should be fixed for one year in one year, and that the increased Surtax should be fixed for that same year in another future year. I support the Amendment, and I hope that between now and the Report stage the Government will see something of the kind of mess into which they are leading our financial procedure by a course of this kind.

12 m.

Mr. P. SNOWDEN: This difficulty arises out of the alteration that was carried out by the right hon. Gentleman three years ago when he changed the Super-tax into the Surtax. The old Super-tax was charged for the year in which it was assessed and collected and, therefore, no such difficulty as the one in which we are at the moment could have arisen under those circumstances. But the right hon. Gentleman came to the conclusion that this Super-tax was not a tax for the year in which it was assessed but that it was a deferred part of the Income Tax upon the previous year, that it was really a tax paid in respect of the previous year and, therefore, he called it a Surtax. The Surtax, being regarded as a deferred payment of Income Tax for the previous year, had its rate fixed in that year. The result is that the Surtax is taken out of the purview of the Chancellor of the Exchequer. Last year we fixed the rate of Surtax for this year. It would be just as reasonable
to apply that to the ordinary Income Tax and fix the rate not merely for one year but for any number of years.

Sir D. HERBERT: For an annual tax?

Mr. SNOWDEN: Yes. The hon. and learned Gentleman in the earlier part of our debates failed to realise that Income Tax and Surtax were part of one tax.

Sir D. HERBERT: I do not know whether the right hon. Gentleman is mixing me up with someone else. I never did otherwise than believe and know—it is my business to know—that Income Tax at the standard rate and Income Tax at the increased rate, otherwise known as Surtax, are both Income Tax. Of course, they are separated and distinct from one another in certain respects, but I never suggested that they are not both part of one and the same tax.

Mr. SNOWDEN: I apologise, and I unreservedly accept what the hon. and and learned Gentleman has said. The point I am making is that the Surtax has now been taken out of the immediate control of the Chancellor of the Exchequer and, unless there can be some alteration of the law, it will be impossible, whatever the needs of the nation may be in the current year, to make any contribution to that need from an increase in the Surtax. This involves a revenue of something like £60,000,000. We might as well apply it to the Income Tax. That would be an utterly impossible position.

Mr. CHURCHILL: Will the right hon. Gentleman state the amount of money involved in the change that he is making in the previous incidence of the tax?

Mr. SNOWDEN: I am speaking from memory, but I think the revenue will be about £3,500,000 increase this year, and £7,000,000 in a full year. I have taken power to increase the tax upon this deferred part of the Income Tax which is called Surtax, and I am reverting to the position as it was with the old Super-Tax, so that the charge will be fixed in the year in which it is assessed. Apart from that, there is no material change. I must correct the figures I have given. I said it would be £7,000,000 in a full year. It is estimated to be £79,500,000 this year and £12,500,000 in
a full year. On the 1st January, 1930, taxpayers paid Surtax for the first time. That was Surtax for 1928–29, and was charged on the statutory income of that year. If there had been no change such as the change made in 1927 by the right hon. Gentleman they would have paid just the same. They would have paid Super-Tax for 1929–30, but it would have been charged on the statutory income of 1928–29. I am, making an annual review of the Surtax.

Mr. LEIF JONES: I think that much of the indignation is due to some misunderstanding. I would recommend the Chancellor of the Exchequer to consult the phraseology of his Income Tax Clauses. We are dealing with tax payable on the 1st January, 1931, but we have not settled what Income Tax is to be paid on that date. The Income Tax payable on the 1st January, 1931, ought to be called Income Tax for 1930–31. There is a lag of two years in one case and one year in another. A great deal of confusion would be avoided if we called the Income Tax payable on the 1st January, 1931, the tax at the standard rate of Surtax for the year 1930–31. I submit that if that were done, there would be a good deal less confusion in settling the tax, but it cannot be alleged against the Chancellor of the Exchequer that in this Budget he is doing anything unfair to the taxpayer in opening this matter of the Surtax. It is, in my view, far better to simplify these things.

Mr. CHURCHILL: I want to make an appeal to the parties of the Opposition, and I take full responsibility myself in saying that we under-estimated the gravity and complexity of the problems which arise on these two Clauses. I must admit that, taking full responsibility for any part that I had in that miscalculation. The right hon. Gentleman proposed earlier in the day not to proceed beyond Clause 9, and it was my belief that, while we might sit on till the very late hours of to-morrow morning, Clause 9 would probably be within the compass of the Government to achieve by that time, but its difficulty has undoubtedly been borne in increasingly on the Committee this evening, and a number of extremely difficult and complicated questions have arisen which have not been adequately discussed. Nevertheless, I did say, taking full responsibility myself, that we
did not consider that the proposal of the right hon. Gentleman was unreasonable. Therefore, I must appeal to hon. Members on this side to facilitate the termination of our discussion at the period which was considered to be in accord with the general convenience of the Committee. But I must say that it is clear, from our survey of Clauses 7 and 8, that these issues must be raised in the fullest possible manner upon Report, and I trust that you, Sir, in the Chair, will also bear in mind the abridgement of the discussion on this occasion, which has arisen from a perfectly sincere and natural error, and that you will, in your

capacity in the Chair, also guard us from any abridgement of the discussion when the Report stage is reached.

Amendment negatived.

Sir A. POWNALL: I do not propose to move any one of the next 10 Amendments standing in my name and the names of my hon. Friends, but I wish to reserve my rights to raise very important questions regarding the Surtax on the Report stage.

Question put, "That the Clause stand part of the Bill."

The Committee Divided: Ayes, 219; Noes, 127.

Division No.334.]
AYES.
[12.18 a.m.


Adamson, Rt. Hon. W. (Fife, West)
Gould, F.
Logan, David Gilbert


Adamson, W. M. (Staff., Cannock)
Graham, D. M. (Lanark, Hamilton)
Longden, F.


Addison, Rt. Hon. Dr. Christopher
Granville, E.
Lovat-Fraser, J. A.


Aitchison, Rt. Hon. Craigie M.
Gray, Milner
Lunn, William


Alpass, J. H.
Grenfell, D. R. (Glamorgan)
Macdonald, Gordon (Ince)


Arnott, John
Griffith, F. Kingsley (Middlesbro' W.)
MacDonald, Malcolm (Bassetlaw)


Aske, Sir Robert
Griffiths, T. (Monmouth, Pontypool)
McElwee, A.


Baldwin, Oliver (Dudley)
Groves, Thomas E.
McEntee, V. L.


Barnes, Alfred John
Grundy, Thomas W.
McKinlay, A.


Batey, Joseph
Hall, F. (York, W. R., Normanton)
McShane, John James


Bellamy, Albert
Hall, G. H. (Merthyr Tydvil)
Malone, C. L'Estrange (N'thampton)


Benson, G.
Hall, Capt. W. P. (Portsmouth, C.)
Mansfield, W.


Bentham, Dr. Ethel
Hamilton, Mary Agnes (Blackburn)
Marcus, M.


Bevan, Aneurin (Ebbw Vale)
Harbord, A.
Markham, S. F.


Birkett, W. Norman
Hardie, George D.
Marley, J.


Bowen, J. W.
Harris, Percy A.
Mathers, George


Bromfield, William
Hastings, Dr. Somerville
Matters, L. W.


Bromley, J.
Haycock, A. W.
Maxton, James


Brooke, W.
Hayday, Arthur
Messer, Fred


Brothers, M.
Hayes, John Henry
Middleton, G.


Brown, C. W. E. (Notts, Mansfield)
Henderson, Arthur, junr. (Cardiff, S.)
Milner, Major J.


Brown, Ernest (Leith)
Henderson, Thomas (Glasgow)
Montague, Frederick


Brown, Rt. Hon. J. (South Ayrshire)
Henderson, W. W. (Middx., Enfield)
Morgan, Dr. H. B.


Brown, W. J. (Wolverhampton, West)
Herriotts, J.
Morley, Ralph


Buchanan, G.
Hirst, G. H. (York W. R. Wentworth)
Morrison, Herbert (Hackney, South)


Burgess, F. G.
Hirst, W. (Bradford, South)
Mort, D. L.


Burgin, Dr. E. L.
Hollins, A.
Moses, J. J. H.


Caine, Derwent Hall-
Hopkin, Daniel
Mosley, Lady C. (Stoke-on-Trent)


Cape, Thomas
Horrabin, J. F.
Mosley, Sir Oswald (Smethwick)


Carter, W. (St. Pancras, S. W.)
Hudson, James H. (Huddersfield)
Muff, G.


Charleton, H. C.
Hunter, Dr. Joseph
Nathan, Major H. L.


Chater, Daniel
Hutchison, Maj.-Gen. Sir R.
Newman, Sir R. H. S. D. L. (Exeter)


Church, Major A. G.
Isaacs, George
Noel Baker, P. J.


Clarke, J. S.
Jenkins, W. (Glamorgan, Neath)
Oliver, George Harold (IIkeston)


Cocks, Frederick Seymour
John, William (Rhondda, West)
Oliver, P. M. (Man., Blackley)


Compton, Joseph
Johnston, Thomas
Owen, H. F. (Hereford)


Daggar, George
Jones, F. Llewellyn- (Flint)
Palin, John Henry


Dallas, George
Jones, J. J. (West Ham, Silvertown)
Paling, Wilfrid


Dalton, Hugh
Jones, Rt. Hon Leif (Camborne)
Palmer, E. T.


Day, Harry
Jones, Morgan (Caerphilly)
Parkinson, John Allen (Wigan)


Denman, Hon. R. D.
Jones, T. I. Mardy (Pontypridd)
Perry, S. F.


Dickson, T.
Jowett, Rt. Hon. F. W.
Peters, Dr. Sidney John


Dudneon, Major C. R.
Jowitt, Rt. Hon. Sir W. A.
Pethick- Lawrence, F. W.


Dukes, C.
Kedward, R. M. (Kent, Ashford)
Potts, John S.


Duncan, Charles
Kennedy, Thomas
Price, M. P.


Ede, James Chuter
Kinley, J.
Pybus, Percy John


Edmunds, J. E.
Kirkwood, D.
Quibell, D. J. K.


Edwards, E. (Morpeth)
Lathan, G.
Ramsay, T. B. Wilson


Egan, W. H.
Law, Albert (Bolton)
Rathbone, Eleanor


Elmley, Viscount
Law, A. (Rosendale)
Richardson, R. (Houghton-le-Spring)


Evans, Capt. Ernest (Welsh Univer.)
Lawther, W. (Barnard Castle)
Ritson, J.


Foot, Isaac
Leach, W.
Romeril, H. G.


Freeman, Peter
Lee, Frank (Derby, N. E.)
Rosbotham, D. S. T.


Gardner, J. P. (Hammersmith, N.)
Lee, Jennie (Lanark, Northern)
Rowson, Guy


Gibbins, Joseph
Lees, J.
Russell, Richard John (Eddisbury)


Gibson, H. M. (Lancs, Mossley)
Lewis, T. (Southampton)
Samuel, H. W. (Swansea, West)


Gill, T. H.
Lindley, Fred W.
Sanders, W. S.


Gossling, A. G.
Lloyd, C. Ellis
Sandham, E.


Sawyer, G. F.
Snowden, Rt. Hon. Philip
Welsh, James (Paisley)


Scott, James
Snowden, Thomas (Accrington)
Westwood, Joseph


Scrymgeour, E.
Stamford, Thomas W.
White, H. G.


Shepherd, Arthur Lewis
Stephen, Campbell
Whiteley, Wilfrid (Birm., Ladywood)


Sherwood, G. H.
Strachey, E. J. St. Loe
Wilkinson, Ellen C.


Shield, George William
Strauss, G. R.
Williams, David (Swansea, East)


Shillaker, J. F.
Sullivan, J.
Williams, Dr. J. H. (Llanelly)


Simmons, C. J.
Tinker, John Joseph
Williams, T. (York, Don Valley)


Sinkinson, George
Tout, W. J.
Wilson, C. H. (Sheffield, Attercliffe)


Sitch, Charles H.
Townend, A. E.
Wilson, R. J. (Jarrow)


Smith, Alfred (Sunderland)
Turner, B.
Winterton, G. E. (Leicester, Loughb'gh).


Smith, Ben (Bermondsey, Rotherhithe)
Vaughan, D. J.
Wise, E. F.


Smith, Frank (Nuneaton)
Wallace, H. W.
Young, R. S. (Islington, North)


Smith, Rennie (Penistone)
Watson, W. M. (Dunfermline)



Smith, Tom (Pontefract)
Watts-Morgan, Lt.-Cot. D. (Rhondda)
TELLERS FOR THE AYES.—


Smith, W. H. (Norwich)
Wellock, Wilfred
Mr. Charles Edwards and Mr.




William Whiteley.


NOES


Acland-Troyte, Lieut.-Colonel
Everard, W. Lindsay
Ramsbotham, H.


Albery, Irving James
Falle, Sir Bertram G.
Remer, John R.


Atkinson, C.
Ferguson, Sir John
Reynolds, Col. Sir James


Baillie-Hamilton, Hon. Charles W.
Fermoy, Lord
Roberts, Sir Samuel (Ecclesall)


Balfour, Captain H. H. (I. of Thanet)
Fielden, E. B.
Ross, Major Ronald D.


Balniel, Lord
Fison, F. G. Clavering
Russell, Alexander West (Tynemouth)


Beaumont, M. W.
Ford, Sir P. J.
Salmon, Major I.


Betterton, Sir Henry B.
Fremantle, Lieut.-Colonel Francis E.
Samuel, A. M. (Surrey, Farnham)


Bevan, S. J. (Holborn)
Gault, Lieut.-Col. Andrew Hamilton
Samuel, Samuel (W'dsworth, Putney)


Birchall, Major Sir John Dearman
Gibson, C. G. (Pudsey & Otley)
Sandeman, Sir N. Stewart


Bird, Ernest Roy
Gower, Sir Robert
Sassoon, Rt. Hon. Sir Philip A. G. D.


Boothby, R. J. G.
Graham, Fergus (Cumberland, N.)
Savery, S. S.


Bourne, Captain Robert Croft
Greene, W. P. Crawford
Shepperson, Sir Ernest Whittome


Bracken, B.
Grenfell, Edward C. (City of London)
Sinclair, Col. T. (Queen's U., Belfst)


Brass, Captain Sir William
Gretton, Colonel Rt. Hon. John
Smith, Louis W. (Sheffield, Hallam)


Briscoe, Richard George
Gunston, Captain D. W.
Smithers, Waldron


Brown, Col. D. C. (N'th'l'd., Hexham)
Hall, Lieut.-Col. Sir F. (Dulwich)
Somerville, D. G. (Willesden, East)


Brown, Brig.-Gen. H. C. (Berks, Newb'y)
Hamilton, Sir George (Ilford)
Southby, Commander A. R. J.


Buckingham, Sir H.
Hartington, Marquess of
Spender-Clay, Colonel H.


Butler, R. A.
Haslam, Henry C.
Stanley, Lord (Fylde)


Cadogan, Major Hon. Edward
Henderson, Capt. R. R. (Oxf'd, Henley)
Stanley, Maj. Hon. O. (W'morland)


Carver, Major W. H.
Hennessy, Major Sir G. R. J.
Steel-Maitland, Rt. Hon. Sir Arthur


Cayzer, Sir C. (Chester, City)
Herbert, Sir Dennis (Hertford)
Stuart, Hon. J. (Moray and Nairn)


Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.)
Hills, Major Rt. Hon. John Waller
Thomas, Major L. B. (King's Norton)


Chamberlain, Rt. Hon. N. (Edgbaston)
Horne, Rt. Hon. Sir Robert S.
Titchfield, Major the Marquess of


Christie, J. A.
Hudson, Capt. A. U. M. (Hackney, N.)
Todd, Capt. A. J.


Churchill, Rt. Hon. Winston Spencer
Iveagh, Countess of
Train, J.


Colfox, Major William Philip
Knox, Sir Alfred
Turton, Robert Hugh


Colville, Major D. J.
Lamb, Sir J. Q.
Vaughan-Morgan, Sir Kenyon


Courtauld, Major J. S.
Lane Fox, Col. Rt. Hon. George R.
Ward, Lieut.-Col. Sir A. Lambert


Cranborne, Viscount
Leighton, Major B. E. P.
Warrender, Sir Victor


Crichton-Stuart, Lord C.
Long, Major Eric
Waterhouse, Captain Charles


Croft, Brigadier-General Sir H.
Macdonald, Capt. P. D. (I. of W.)
Wells, Sydney R.


Crookshank, Cpt. H. (Lindsey, Gainsbro)
MacRobert, Rt. Hon. Alexander M.
Williams, Charles (Devon, Torquay)


Culverwell, C. T. (Bristol, West)
Marjoribanks, E. C.
Windsor-Clive, Lieut.-Colonel George


Dalkeith, Earl of
Mason, Colonel Glyn K.
Wolmer, Rt. Hon. Viscount


Dalrymple-White, Lt.-Col. Sir Godfrey
Monsell, Eyres, Com. Rt. Hon. Sir B.
Womersley, W. J.


Davidson, Major-General Sir J. H.
Morrison, W. S. (Glos., Clrencester)
Wood, Rt. Hon. Sir Kingsley


Dixey, A. C.
Nicholson, O. (Westminster)
Worthington-Evans, Rt. Hon. Sir L.


Dixon, Captain Rt. Hon. Herbert
Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)



Duckworth, G. A. V.
O'Neill, Sir H.
TELLERS FOR THE NOES.—


Eden, Captain Anthony
Percy, Lord Eustace (Hastings)
Sir Frederick Thomson and Captain


Edmondson, Major A. J.
Peto, Sir Basil E. (Devon, Barnstaple)
Euan Wallace.


Elliot, Major Walter E.
Pownall, Sir Assheton



Motion made, and Question, "That the Clause stand part of the Bill," put, and agreed to.

CLAUSE 9.—(Amendment of s. 40 (2) of Finance Act, 1927.)

The CHAIRMAN: Mr. Smithers.

Mr. SMITHERS: I had a long speech to deliver on an important constitutional point, but, owing to the lateness of the hour, I do not now propose to move my Amendment to postpone this Clause until after the new Clauses.

Motion made, and Question, "That the Chairman do report Progress, and
ask leave to sit again," put, and agreed to.—[Mr. P. Snowden.]

Committee report Progress; to sit again upon Thursday.

The remaining Orders were read, and postponed.

It being after half-past Eleven of the clock upon Tuesday evening, Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing Order.

Adjourned at Twenty-nine Minutes after Twelve o' Clock.